AGENDA. 9. Consider and Take Appropriate Action on Approval of City of Canyon s Investment Policy

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1 AGENDA NOTICE OF MEETING Notice is hereby given that the governing body of the City of Canyon will meet at 5:30 p.m. on the 22nd day of January 2018, in the Commission Chambers of City Hall at th Street in the City of Canyon to discuss the following agenda items: 1. Call to Order. 2. Invocation. 3. Pledge of Allegiance. 4. Approval of the Minutes of the Meeting of January 8, Public Comment Comments from Interested Citizens. 6. Consent Agenda: It is recommended that the consent agenda be approved with one motion. A. Conduct Second Reading and Consider and Take Appropriate Action on Adoption of Resolution No With Regards to a Request from Panhandle-Plains Historical Museum for Sponsorship of the Pop Culture Exhibit Opening B. Conduct Second Reading and Consider and Take Appropriate Action on Adoption of Resolution No With Regards to a Request from Creek House Honey Farm for Direct Financial Assistance to Expand the Current Business at th Avenue, Canyon. C. Conduct Second Reading and Consider and Take Appropriate Action on Adoption Resolution No With Regards to a Request from Squeezy Street Juice Bar LLC., for Direct Financial Assistance for a New Business Located at th Avenue, Ste., 203, Canyon, Texas. The Funding is Based on New Business Development D. Conduct Second Reading and Consider and Take Appropriate Action on Adoption of Resolution No With Regards to a Request from Canyon Main Street for Direct Financial Assistance to Fund a Twelve-Month Marketing Campaign for Canyon and Downtown Dining District 7. Conduct Second Reading and Consider and Take Appropriate Action on Adoption of Resolution No With Regards to a Request from Fox & Owl LLC. Dba Barrell & Pie for Direct Financial Assistance for a New Business Located at th Avenue, Ste. 101, Canyon, Texas. 8. Conduct Second Reading and Consider and Take Appropriate Action on Adoption of Resolution No With Regards to a Request from Rocar, Inc., dba U.S. Cleaners, a New Business to be Located at 2005 N. 2 nd Avenue, Ste. A., (The Depot) Canyon, Texas. The Funding is Based on New Business Development. 9. Consider and Take Appropriate Action on Approval of City of Canyon s Investment Policy 10. Consider and Take Appropriate Action on Quarterly Finance Report. 11. Consider and Take Appropriate Action on Quarterly Investment Report. 12. Consider and Take Appropriate Action on Agreement for Alternative Payment Method with Potter-Randall Appraisal District. City of Canyon

2 13. Consider and Take Appropriate Action on Livestock Permit for Alberta Evans. 14. Consider and Take Appropriate Action on Plat for Hix Road Unit No Consider and Take Appropriate Action on Plat for Nester Estate Unit No Code Enforcement Annual Report. 17. Executive Session Pursuant to Deliberation of Real Property, and Consultation with Attorney. 18. Consider and Take Appropriate Action on Items Discussed in Executive Session. 19. Adjourn. Randy Criswell, City Manager I certify that the above Notice of Meeting was posted on the bulletin board of the Civic Complex of the City of Canyon, Texas on the 19 th day of January Gretchen Mercer, City Clerk City of Canyon

3 City Commission Meeting January 8, 2017 The City Commission of the City of Canyon met in regular session at 5:30 p.m. in the City Commission Chambers of the Civic Complex. Mayor Gary Hinders presided over the meeting with the following Commissioners in attendance, Cordell Jones, Roger Remlinger and Paul R. Lyons. Mayor Pro-Tem Justin Richardson was unable to attend. Also present were the following City Staff: City Manager Randy Criswell, Assistant City Manager Chris Sharp, Director of Business and Community Development Evelyn Ecker, Director of Parks and Recreation Brian Noel, Assistant City Manager for Special Projects Jon Behrens, and City Attorney Chuck Hester. Item 1. Call to Order. Mayor Hinders called the meeting to order at 5:32 p.m. Item 2. Invocation. Commissioner Jones gave the invocation. Item 3. Pledge of Allegiance. The Pledge of Allegiance was led Commissioner Lyons. Item 4. Approval of Minutes of the Meeting December 4, Commissioner Remlinger moved, duly seconded by Commissioner Jones, to approve the minutes of December 4, 2017 as presented. Motion carried unanimously. Item 5. Public Comment Comments From Interested Citizens. No comments were made. Item 6. Consent Agenda: It is recommended that the consent agenda be approved with one motion. A. First Reading of Resolution No With Regards to a Request from Panhandle- Plains Historical Museum for Sponsorship of the Pop Culture Exhibit Opening B. First Reading of Resolution No With Regards to a Request from Creek House Honey Farm for Direct Financial Assistance to Expand the Current Business at th Avenue, Canyon. C. First Reading of Resolution No With Regards to a Request from Fox & Owl LLC. Dba Barrell & Pie for Direct Financial Assistance for a New Business Located at th Avenue, Ste. 101, Canyon, Texas. D. First Reading of Resolution No With Regards to a Request from Rocar Inc., dba U.S. Cleaners, a New Business to be Located at 2005 N. 2 nd Avenue, Ste. A., (The Depot) Canyon, Texas. The Funding is Based on New Business Development.

4 City Commission Meeting January 8, 2018 Page 2 of 5 E. First Reading of Resolution No With Regards to a Request from Squeezy Street Juice Bar LLC., for Direct Financial Assistance for a New Business Located at th Avenue, Ste., 203, Canyon, Texas. The Funding is Based on New Business Development. F. First Reading of Resolution No With Regards to a Request from Canyon Main Street for Direct Financial Assistance to Fund a Twelve Month Marketing Campaign for Canyon and Downtown Dining District. Mayor Hinders and City Manager Randy Criswell gave a brief explanation of how a consent agenda works. Mayor Hinders read each caption as required. Commissioner Lyons expressed his opinion that equipment purchase assistance is appropriate, but that he doesn t support salary assistance as is being done for Barrell & Pie (Resolution No ). Business and Community Development Director Evelyn Ecker explained the $25,000 is for the 4 upper management positions that were incentivized as a onetime incentive. Commissioner Jones asked if this type of incentive has been done before, and Ms. Ecker stated yes. Commissioner Lyons expressed his opinion that it is not the place of the CEDC to pay rent or lease for any business. He stated it was his understanding that Modern Cleaners was denied funding before, so this would be unfair. Commissioner Remlinger asked if Modern Cleaners had ever applied for funding and Ms. Ecker stated they had not. Ms. Ecker stated the CEDC utilizes retail studies that establish that Canyon can easily support up to two more dry cleaners, so this project is recommended for funding to eliminate leakage dollars going to Amarillo. This was the first reading of Resolutions , , , , and No action required. Item 7. Consider and Take Appropriate Action on Proposed Ordinance No. 1073A Correcting the Legal Description of Canyon East Unit 6. City Attorney Chuck Hester presented Ordinance No. 1073A for consideration. Mr. Hester stated an error was found in the legal description causing an overlap. Mr. Hester said this ordinance corrects that overlap. After discussion Commissioner Remlinger moved, duly seconded by Commissioner Jones to approve Ordinance No. 1073A as presented. Motion carried unanimously. ORDINANCE NO. 1073A ANNEXING TERRITORY TO THE CITY OF CANYON (CANYON EAST UNIT 6) AN ORDINANCE OF THE CITY OF CANYON, TEXAS, ANNEXING THE TERRITORY HEREIN DESCRIBED TO THE CITY OF CANYON IN RANDALL COUNTY, TEXAS, EXTENDING THE BOUNDARY LIMITS OF THE CITY OF CANYON TO INCLUDE THE PROPERTY HEREIN DESCRIBED WITHIN THE SAID CITY LIMITS, AND GRANTING TO ALL THE INHABITANTS OF SAID PROPERTY ALL THE RIGHTS AND PRIVILEGES OF OTHER CITIZENS AND BINDINGS SAID

5 City Commission Meeting January 8, 2018 Page 3 of 5 INHABITANTS BY ALL OF THE ACTS, ORDINANCES, RESOLUTIONS, AND REGULATIONS OF SAID CITY. Item 8. Consider and Take Appropriate Action on Interlocal Agreement with City of Amarillo for Emergency Management Services. City Manager Randy Criswell presented an Interlocal Agreement with the City of Amarillo for Emergency Management Services. Mr. Criswell said this agreement would put the City of Canyon under the umbrella of Amarillo for emergency services and give Canyon a chance to partner with the City of Amarillo, join resources and provide better emergency services to the citizens of Canyon. Mr. Criswell stated the agreement will authorize the City of Amarillo OEM to head up our emergency management services, take care of a tremendous amount of paperwork and assist when needed with emergency management. The City of Canyon will agree that any Emergency Management Planning Grant money the city is eligible for will be provided to Amarillo plus an additional amount of about $20,000 annually. Mr. Criswell said that the Interlocal Agreement needs to be approved as well as a budget amendment for $20,000 to be paid annually to the City of Amarillo. Mayor Hinders and Commissioner Lyons asked if the EMPG grant money is not funded, does the city have to fund that extra $20,000. Mr. Criswell said yes. Commissioner Jones spoke in favor of such an agreement and the strong need for this to benefit Canyon Citizens. After discussion, Commissioner Jones moved, duly seconded by Commissioner Remlinger Approve the Interlocal Agreement with the City of Amarillo for Emergency Management Services and to approve a budget amendment of up to $20,000 to fund the OEM services. Motion carried unanimously. Item 9. Consider and Take Appropriate Action on Parks Improvement Plan Progress Report. Parks and Recreation Director Brian Noel presented the Commissioners with an update on the Parks Improvements that had been defined in the Parks Improvement Plan a few weeks ago. Mr. Noel briefly went over the items that had been completed and those that still remain, and a tentative schedule. Mayor Hinders then presented a list of projects he thinks need addressing. Mr. Hinders stated he would like to see a study comparing repair versus replacement of restroom facilities, he wanted picnic tables and shade awnings addressed, and he was opposed to the plan to completely convert Hunsley Park to Bermudagrass. City Manager Randy Criswell stated Assistant City Manager Jon Behrens is currently working on a Parks Master Plan that will address things like the types of grass that will be utilized in the parks as well as addressing some of Mayor Hinders other concerns. Mr. Criswell said the Parks Master Plan will be a continuation of the Comprehensive Plan that is currently in progress as well, but the Comprehensive Plan needs to be adopted before the Parks Master Plan. Mayor Hinders stated the Parks Department needs to a better job of keeping an eye on detail of smaller things and asked for more communication. He also questioned the function of the Parks Committee and how it might be better utilized. Item 10. Executive Session Pursuant to Real Property, Consultation with Attorney, and Appointments to Boards and Commissions (Zoning Board of Adjustment, Board of City Development, Parks, Open Space and Recreation Advisory Committee, and Canyon Housing Authority). Mayor Hinders indicated the Commission would adjourn into Executive Session at 6:38 p.m.

6 City Commission Meeting January 8, 2018 Page 4 of 5 Item 11. Consider and Take Appropriate Action on Items Discussed in Executive Session. Upon returning from Executive Session at 8:07 pm, the following action was taken. Commissioner Remlinger moved, duly seconded by Commissioner Jones to reappoint Rich Hopson, Wiley Harp and Mary Ellen Brandt to the Zoning Board of Adjustment and to designate Rich Hopson and Charles Robinson as alternate board members. Motion carried unanimously. Commissioner Jones moved, duly seconded by Commissioner Lyons to reappoint Jimmy Lackey and Linda Washington, and to appoint Jeremy Rivera to the expired term of Wendell Brown to the Parks, Open Space, and Recreation Advisory Committee. Motion carried unanimously. Commissioner Lyons moved, duly seconded by Mayor Hinders to appoint Gina Woodward to fulfill the place vacated by Dave Hutson who no longer lives in the City of Canyon. Motion carried with Commissioner Remlinger and Commissioner Jones abstaining. Commissioner Remlinger moved, duly seconded by Commissioner Jones to reappoint Connie Hopson to the Canyon Housing Authority. Motion carried unanimously. Item 12. Consider and Take Appropriate Action on Discussion and Protocol for Strategic Planning Session. Mayor Hinders stated he would like to meet mid-morning, have open discussion and get to know about each other, have lunch then an informal planning session discussion. Commissioner Jones moved, duly seconded by Commissioner Remlinger to hold the Strategic Planning Session on Friday, February 2, Motion carried unanimously. Item 13. Consider and Take Appropriate Action on Discussion for a Possible Dual Meeting Between Canyon City Commission and the Members of the Canyon Economic Development Corporation Board of Directors. After discussion, Commissioners directed Business and Community Development Director and City Manager Randy Criswell to work on a schedule for the dual meeting. Item 14. Consider and Take Appropriate Action on Selection of Meeting Dates February After discussion it was decided the Commission would only meet once for February 2018 on Monday February 5, Item 15. Adjourn. There being no further business, Commissioner Remlinger moved this meeting be adjourned.

7 City Commission Meeting January 8, 2018 Page 5 of 5 ATTEST: Gary Hinders, Mayor Gretchen Mercer, City Secretary

8 CONSENT ITEM A AGENDA To: From: Randy Criswell, City Manager Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2018 Re: Conduct Second Reading and Consider and Take Appropriate Action on No With Regards to a Request from Panhandle- Plains Historical Museum for Sponsorship of the Pop Culture Exhibit Opening 2018 The Panhandle-Plains Historical Museum is one of the primary attractions in Canyon. They host thousands of visitors each year and strive to keep refreshing the exhibits and focusing on all demographics. The Pop Culture exhibit opens February 2018 and will be a twelve month promoted event. Pop Culture permeates our society with every generation adding to the definition of pop culture The exhibit will embrace the varying influences of the past. The goal of the exhibit is to create a first generation experience for the age group. Please find attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution No It is the recommendation of staff to approve Resolution No

9 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT PANHANDLE PLAINS HISTORICAL MUSEUM This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT and Panhandle Plains Historical Museum (hereinafter referred to as Second Party. ) 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are describe as follows: Installation of exhibit POP CULURE opening in 2018 Required statistics made available: visitors to the museum, 12 month Attendance statistics for planned events (7) Marketing Plan for Exhibit with cost 3. The CEDC will provide the following funding and economic incentives for development of the project: $15,000 on or before April 1, The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding. 5. The execution of this agreement has been duly authorized by the Panhandle Plains Historical Museum Board of Directors and all necessary approvals have been obtained. The President of the board is duly authorized and empowered to execute this agreement on behalf of the project. 6. No litigation or governmental proceeding is pending or is contemplated or threatened against Second Party or affecting its operations which would adversely impact the project. To Second Party s knowledge, no additional consent, approval or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the

10 transactions contemplated hereby. 7. To Second Party s knowledge no statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. 8. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to perform the terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. 9. The funds provided by CEDC shall be utilized solely for the purposes of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. 10. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. 11. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. 12. The Second Party agrees, that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 13. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 30 days after written notice by CEDC to Second Party, the CEDC may terminate this agreement 14. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 15. Any delay by the CEDC in providing notice of default to Second Party, shall in no 2.

11 event be deemed or constitute a waiver of such default by CEDC or waiver of any of its rights and remedies available under this agreement or at law or in equity. 16. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 17. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 18. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or it s employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 19. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 20. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 21. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. 22. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 23. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. 3.

12 24. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. 25. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finders fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 26. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. Effective Date Canyon Economic Development Corporation By: Name: Title: Second Party Panhandle Plains Historical Museum By: Mike Conner, President

13 RESOLUTION NO A RESOLUTION OF THE APPROVAL OF A SPONSORSHIP BETWEEN CANYON ECONOMIC DEVELOPMENT CORPORATION AND THE PANHANDLE-PLAINS HISTORICAL MUSEUM WITH REGARDS TO THE POP CULTURE EXHIBIT OPENING 2018 WHEREAS, the Board of Directors of the Canyon Economic Development Corporation ( CEDC ), having taken action by majority vote on December 14, 2017 to approve a funding request from Panhandle-Plains Historical Museum; and, WHEREAS, On December 14, 2017, the Canyon Economic Development Corporation ( CEDC ) held a public hearing regarding the use of sales tax revenues in regards to a funding agreement. The sales tax supporting the CEDC is authorized by Chapter 504 and 505 Texas Local Government Code, formerly known as the Development Corporation Act of 1979 TEX. REV. CIV. STAT. ART B ( the Act ) the primary purpose of which is to develop, stabilize, diversify, and expand the economy; and, WHEREAS, the CEDC is providing $15,000 for exhibit sponsorship and event marketing NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Mayor and City clerk are hereby authorized to execute and attest, respectively on behalf of the City of Canyon, the expenditure for the Pop Culture Exhibit opening at Panhandle-Plains Historical Museum is hereby approved, and the sales tax revenue collected pursuant to the Act by CEDC may be used to fund the project referred to above. INTRODUCED at the First Reading on the 8 th day of January 2018, and Adopted on the Second Reading the 22 nd day of January 22, ATTEST: Gretchen Mercer, City Clerk GARY HINDERS, MAYOR

14 CONSENT ITEM B AGENDA To: From: Randy Criswell, City Manager Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2018 Re: Conduct Second Reading and Consider and Take Appropriate Action on Resolution No With Regards to a Request from Creek House Honey Farm for Direct Financial Assistance To Expand the Current Business at th Avenue, Canyon. Creek House Honey Farm has been in business for five years. The business is owned by George and Paige Nester. The Nesters began beekeeping seven years ago as a hobby. Into the second year the demand was so great they started a honey waiting list for friends and family. The demand for their honey continues to increase to the point of not being able to keep up. Creek House Honey Farm quickly became a business. Last year they purchased 6 acres adjunct to the land. The plans are to build a 40 x 60 building that will have a storefront and industrial kitchen. The goal is to be inspected by the health department so that they can sell the honey to local restaurants and businesses. The expansion also allows for a larger dedicated space for teaching and educational purposes. They have also created a beeswax skin care line to sell along with the honey. Creek House Honey received a $276,000 loan from the USDA to help fund the expansion. The CEDC voted to match 10% of the loan, not to exceed $27,600. This grant will be used for development of the new honey house, educational and teaching areas Please find attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution It is the recommendation of staff to approve Resolution No

15 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT Creek House Honey Farm This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT and Creek House Honey Farm., a Texas business duly organized under the laws of the State of Texas (hereinafter referred to an Second Party. ) 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are described as follows: a. Second Party will expand the business to include technology updates associated with the offering of more educational components with regards to the business.. b. Second Party will maintain retail and educational areas of the business for a minimum of 3 years. 3. The CEDC will provide the following funding and financial incentives for the project: a. An amount, not to exceed $27,600 will be disbursed as follows: (1.) The payment of $27,600 will be made after the full expansion has been completed. This includes development of the new honey house, educational and teaching area. (2.) Sales tax collected, number of classes held, attendees and whether they visited on site or enrolled in an online class. (3.) The skincare line products report will include number of units produced and sold. List of vendors who buy skincare products for resale in stores, sales at site and sales online.. b. All other terms and provisions of this agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: Page 1 of 7

16 i approval of the financial incentives by the CEDC Board; ii approval of the financial incentives by the Canyon City Commission; and, iii compliance with the requirements of the Texas Development Corporation Act of 1979, ART B (4B, a-1) TEX. REV. CIV. STAT. 4. The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding and, at its option, to terminate this agreement by written notice delivered pursuant to paragraph Second Party agrees to undertake the following actions in order to accomplish the project: a. Comply at all times with the requirements of paragraph 2 of this agreement during the term of this agreement. 6. Second Party makes the following covenants and warranties to the CEDC and agrees to timely and fully perform the following obligations and duties: a. Any false or substantially misleading statement contained herein or the failure of Second Party to comply and fully perform as required in this agreement shall be an act of default by Second Party. Failure to comply with any covenant or warranties shall constitute an act of default and entitle the CEDC to suspend further funding and at it s option to terminate this agreement by written notice in accordance with paragraph 9 below. b. Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this agreement. c. No litigation or governmental proceeding is pending or to the knowledge of Second Party is contemplated or threatened against Second Party or affecting it s operations or business that may result in any material or adverse change in Second Party s business, properties, or operations. To Second Party s knowledge, no additional consent, approval, or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the transactions contemplated hereby. d. To Second Party s knowledge no certificate or statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. e. There are no bankruptcy proceedings or other legal proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. f. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to carry on it s business in Texas and to perform the Page 2 of 7

17 terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. g. The funds provided by CEDC shall be utilized solely for the purpose of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. h. Second Party shall pay all taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party s property and business operations. In addition, Second Party shall timely pay all employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities. i. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. j. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. k. Upon written request of CEDC Second Party shall notify CEDC in writing of substantial changes in the management of Second Party within seven (7) days. Substantial changes shall mean changes in executive officers, board members, or managers. l. The Second Party agrees that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 7. The CEDC under the following circumstances and at the sole discretion of its board of directors may suspend the obligations under this agreement or may terminate this agreement without liability to the CEDC upon: a. The filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any part of it s assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing. b. The adjudication of Second Party as a bankrupt. c. A change in ownership of Second Party which constitutes a material change in the nature of Second Party s business and operations, unless Second Party has complied with paragraph 2 and 3(d) above. 8. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 60 days after written notice by CEDC to Second Party, the CEDC may terminate this agreement and pursue any legal remedies existing under the law; provided however, that Second Page 3 of 7

18 Party s liability under this agreement shall be limited to the immediate return by Second Party of all funds or other economic incentives provided by the CEDC and any consideration previously paid to Second Party by the CEDC. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be 6% per annum. In the event CEDC should prevail in any litigation to recover funds pursuant to this paragraph, the CEDC shall, in addition to all other damages provided by this paragraph, be entitled to recover reasonable attorney s fees and expenses of litigation. Provided, however, that if the default relates only to the number of employees to be maintained under Paragraph 2.c., the sole remedy of the First Party shall be to reduce the amount paid as set forth in Paragraph 3.d. of this agreement. 9. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 10. Any delay by the CEDC in providing notice of default to Second Party, shall in no event be deemed or constitute a waiver of such default by CEDC or waiver of any of it s rights and remedies available under this agreement or at law or in equity. 11. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 12. Second Party specifically agrees that CEDC shall only be liable to Second Party for the amount of money actually budgeted and committed to the project described in this agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorneys fees, court costs, actual or consequential damages, direct or indirect, for any act of default by CEDC under the terms of this agreement. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the project cost out of its sales tax revenues held and administered pursuant to 4B of the Development Corporation Act for the fiscal year in which the funding under this agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed however, that in the event actual total sales tax revenues collected by CEDC for any year during which this agreement is to be performed should be less than the total amount of all grants to all contracting parties for that year, then in that event, CEDC shall fund projects in the order the grants were awarded after payment of CEDC s usual administrative cost and expenses. All contracting parties shall receive only their share of the available sales tax revenue for that year, less CEDC s customary and usual administrative costs and expenses and CEDC shall not be liable to any contracting party for any deficiency for that time or in the future. In the event of such revenue shortfall, CEDC will provide written notice to all contracting parties affected by the revenue shortfall along with such documentation as will allow the contracting party to ascertain their share of the funding to be provided. Page 4 of 7

19 13. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the Matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 14. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or its employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 15. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 16. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 17. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this agreement, consents to and waives any objections to in personam jurisdiction in Randall County, Texas. 18. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 19. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. Second Party agrees that, in compliance with this agreement, it will promptly comply with all applicable laws, regulations, orders, and rules of the state, city, and other governmental entities. 20. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. Provided however, that in the event Second Party transfers all or substantially all it s assets to another entity or merges with another entity to the extent that the underlying purpose of this agreement cannot, in the sole discretion of the CEDC s board of directors, be accomplished, the CEDC shall have the option to suspend it s performance under this agreement or terminate this agreement. Page 5 of 7

20 21. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finder s fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 22. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. 23. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this agreement shall survive the original execution date of this agreement and shall constitute continuing obligations. Effective Date: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Don Lee, President th Avenue, Ste., 21, Canyon, Texas Second Party Creek House Honey Farm. By: George Nester, Owner By: Paige Nester, Owner Page 6 of 7

21 RESOLUTION NO APPROVING PROJECT FUNDING AGREEMENT BETWEEN THE CANYON ECONOMIC DEVELOPMENT CORPORATION AND CREEK HOUSE HONEY FARM FOR DIRECT FINANCIAL ASSISTANCE TO EXPAND THE CURRENT BUSINESS AT TH AVENUE. THE EXPANSION WOULD ENCOURAGE RETAIL SALES, GENERATE STATE AND LOCAL TAX REVENUE WHEREAS, on December 14, 2017, the Canyon Economic Development Corporation ( CEDC ) held a public hearing regarding the use of sales and use tax revenues collected pursuant to the Development Corporation Act of 1979 (Tex. Rev. Civ. Stat. Art B, ( the Act ) and to consider a funding agreement for the expansion of Creek House Honey Farm. The project would encourage retail sales and generate state and local tax revenue. WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to execute a Project Funding Agreement between the Canyon Economic Development Corporation and Creek House Honey Farm; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Mayor and City Clerk are hereby authorized to execute and attest, respectively, on behalf of the City of Canyon, Texas, a Project Funding Agreement between the Canyon Economic Development Corporation and Creek House Honey Farm; regarding the use of funds from the Sales Tax Improvement Fund (Fund40) for costs related to the project. INTRODUCED at the First Reading on the 8 th day of January, 2018, and Adopted on the Second Reading on the 22 nd day of January, ATTEST: GARY HINDERS, MAYOR Gretchen Mercer, City Clerk

22 CONSENT ITEM C AGENDA To: From: Randy Criswell, City Manager Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2018 Re: Conduct Second Reading and Consider and Take Appropriate Action on Resolution No with Regards to a Request from Squeezy Street Juice Bar LLC. For Direct Financial Assistance For a New Business Located at th Avenue, Ste., 203, Canyon, Texas. The Funding is Based on New Business Development. Squeezy Street Juice Bar is owned and operated by Julie Simmons and Cody Hudson. They were born and raised in Canyon. Their parents owned a successful business on the square for 30 years. As a result, they both have a perspective for hard work and customer service. The new business will offer Canyon something that is not currently being offered. They will serve fresh juices, smoothies, and some food options such as avocado toast, fruit pizza and nice cream which is a healthy, non-dairy ice cream. Their target market is the high school and college student, as well as anyone who is look for healthy alternatives. The menu will also have vegan options which will be a first for Canyon. The CEDC approved funding not to exceed $15,500. Funding will be disbursed over twelve (12) months. The first payment of $7,750 will be disbursed when the business is official open (Certificate of Occupancy from city) and the second and final payment will be made on the business s one year anniversary. The final payment is contingent upon the success of meeting the Gross Revenue Sales as set forth in the Business Plan & Projections. Please find attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution No It is the recommendation of staff to approve Resolution No

23 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT SQUEEZY STREET JUICE BAR LLC. This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT and Squeezy Street Juice Bar LLC., a duly organized business under the laws of the State of Texas and qualified to do business in Texas. 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are described as follows: a. Second Party shall maintain the business located at th Avenue, Ste. 203, Canyon,Texas. b. Second Party will maintain space as retail for a minimum of 3 years. The definition of retail is defined as consistent business hours Monday Saturday. 3. The CEDC will provide the following funding and financial incentives for the project: a. An amount, not to exceed $15,500 is as follows: (1.) The payment of $7,750 for direct financial assistance with purchase of equipment (2.) The payment of $7,750 will be made on the 1-year anniversary of the opening of the business. The final payment is contingent upon the success of meeting the Gross Revenue Sales as set forth in the Business Plan and Projections. Page 1 of 7

24 (4) Sales tax collected and business financials will be validated annually from the Effective date of the Funding Agreement. b. All other terms and provisions of this agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: i approval of the financial incentives by the CEDC Board; ii approval of the financial incentives by the Canyon City Commission; and, iii compliance with the requirements of the Texas Development Corporation Act of 1979, ART B (4B, a-1) TEX. REV. CIV. STAT. 4. The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding and, at its option, to terminate this agreement by written notice delivered pursuant to paragraph Second Party agrees to undertake the following actions in order to accomplish the project: a. Comply at all times with the requirements of paragraph 2 of this agreement during the term of this agreement. 6. Second Party makes the following covenants and warranties to the CEDC and agrees to timely and fully perform the following obligations and duties: a. Any false or substantially misleading statement contained herein or the failure of Second Party to comply and fully perform as required in this agreement shall be an act of default by Second Party. Failure to comply with any covenant or warranties shall constitute an act of default and entitle the CEDC to suspend further funding and at it s option to terminate this agreement by written notice in accordance with paragraph 9 below. b. Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this agreement. c. No litigation or governmental proceeding is pending or to the knowledge of Second Party is contemplated or threatened against Second Party or affecting it s operations or business that may result in any material or adverse change in Second Party s business, properties, or operations. To Second Party s knowledge, no additional consent, approval, or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the transactions contemplated hereby. d. To Second Party s knowledge no certificate or statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. Page 2 of 7

25 e. There are no bankruptcy proceedings or other legal proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. f. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to carry on it s business in Texas and to perform the terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. g. The funds provided by CEDC shall be utilized solely for the purpose of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. h. Second Party shall pay all taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party s property and business operations. In addition, Second Party shall timely pay all employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities. i. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. j. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. k. Upon written request of CEDC Second Party shall notify CEDC in writing of substantial changes in the management of Second Party within seven (7) days. Substantial changes shall mean changes in executive officers, board members, or managers. l. The Second Party agrees that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 7. The CEDC under the following circumstances and at the sole discretion of its board of directors may suspend the obligations under this agreement or may terminate this agreement without liability to the CEDC upon: a. The filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any part of its assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing. b. The adjudication of Second Party as a bankrupt. Page 3 of 7

26 c. A change in ownership of Second Party which constitutes a material change in the nature of Second Party s business and operations, unless Second Party has complied with paragraph 2 and 3(d) above. 8. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 60 days after written notice by CEDC to Second Party, the CEDC may terminate this agreement and pursue any legal remedies existing under the law; provided however, that Second Party s liability under this agreement shall be limited to the immediate return by Second Party of all funds or other economic incentives provided by the CEDC and any consideration previously paid to Second Party by the CEDC. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be 6% per annum. In the event CEDC should prevail in any litigation to recover funds pursuant to this paragraph, the CEDC shall, in addition to all other damages provided by this paragraph, be entitled to recover reasonable attorney s fees and expenses of litigation. Provided, however, that if the default relates only to the number of employees to be maintained under Paragraph 2.c., the sole remedy of the First Party shall be to reduce the amount paid as set forth in Paragraph 3.d. of this agreement. 9. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 10. Any delay by the CEDC in providing notice of default to Second Party, shall in no event be deemed or constitute a waiver of such default by CEDC or waiver of any of it s rights and remedies available under this agreement or at law or in equity. 11. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 12. Second Party specifically agrees that CEDC shall only be liable to Second Party for the amount of money actually budgeted and committed to the project described in this agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorneys fees, court costs, actual or consequential damages, direct or indirect, for any act of default by CEDC under the terms of this agreement. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the project cost out of its sales tax revenues held and administered pursuant to 4B of the Development Corporation Act for the fiscal year in which the funding under this agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed however, that in the event actual total sales tax revenues collected by CEDC for any year during which this agreement is to be performed should be less Page 4 of 7

27 than the total amount of all grants to all contracting parties for that year, then in that event, CEDC shall fund projects in the order the grants were awarded after payment of CEDC s usual administrative cost and expenses. All contracting parties shall receive only their share of the available sales tax revenue for that year, less CEDC s customary and usual administrative costs and expenses and CEDC shall not be liable to any contracting party for any deficiency for that time or in the future. In the event of such revenue shortfall, CEDC will provide written notice to all contracting parties affected by the revenue shortfall along with such documentation as will allow the contracting party to ascertain their share of the funding to be provided. 13. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 14. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or its employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 15. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 16. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 17. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this agreement, consents to and waives any objections to in personam jurisdiction in Randall County, Texas. 18. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 19. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. Second Party agrees that, in compliance with this agreement, it will promptly comply with all applicable laws, regulations, orders, and rules of the state, city, and other governmental entities. Page 5 of 7

28 20. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. Provided however, that in the event Second Party transfers all or substantially all it s assets to another entity or merges with another entity to the extent that the underlying purpose of this agreement cannot, in the sole discretion of the CEDC s board of directors, be accomplished, the CEDC shall have the option to suspend it s performance under this agreement or terminate this agreement. 21. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finder s fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 22. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. 23. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this agreement shall survive the original execution date of this agreement and shall constitute continuing obligations. Page 6 of 7

29 Effective Date: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Don Lee, President th Avenue, Suite 21, Canyon, Texas SQUEEZY STREET JUICE BAR LLC. By: Julie Simmons, Managing Partner By: Cody Hudson, Managing Partner Page 7 of 7

30 RESOLUTION NO A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF CANYON APPROVING PROJECT FUNDING AGREEMENT BETWEEN SQUEEZY STREET JUICE BAR, LLC AND CANYON ECONOMIC DEVELOPMENT CORPORATION REGARDING DIRECT FINANCIAL ASSISTANCE FOR A PROJECT LOCATED AT TH AVENUE, STE. 203, CANYON, TEXAS. THE FUNDING IS BASED ON NEW BUSINESS DEVELOPMENT. WHEREAS, On December 14, 2017, the Canyon Economic Development Corporation ( CEDC ) held a public hearing regarding the use of sales tax revenues in regards to a funding agreement. The sales tax supporting the CEDC is authorized by Chapter 504 and 505 Texas Local Government Code, formerly known as the Development Corporation Act of 1979 TEX. REV. CIV. STAT. ART B ( the Act ) the primary purpose of which is to develop, stabilize, diversify, and expand the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to execute a Project Funding Agreement between the Canyon Economic Development Corporation and Squeezy Street Juice Bar, LLC., a registered entity qualified to do business in Texas. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Project Funding Agreement by and between CEDC and Squeezy Street Juice Bar, LLC., be, approved, and the sales tax revenue collected pursuant to the Act by CEDC may be used for the primary purpose of financial assistance for new business development. The sales tax revenue referred to in this Resolution shall be the revenue on deposit in Sales Tax Improvement Fund (Fund 40) for direct costs related to the project. INTRODUCED at the First Reading on the 8 th day of January 2018, and Adopted on the Second Reading the 22 nd day of January 22, ATTEST: Gretchen Mercer, City Clerk GARY HINDERS, MAYOR

31 CONSENT ITEM D AGENDA To: From: Randy Criswell, City Manager Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2018 Re: Conduct Second Reading and Consider and Take Appropriate Action on Resolution No with Regards to a Request from Canyon Main Street Program for Direct Financial Assistance to Fund a Twelve Month Marketing Campaign for Canyon and Downtown Dining District. Since 2002, the goal of the Canyon Main Street program has been for Canyon to become a destination for those living in the region, as well as capturing the tourist. Canyon Main Street is planning a twelve month campaign starting March of The campaign is focused on existing and new businesses as well as the new Downtown Dining District. The objective of the campaign is to entice the traffic from US Highway 60 and I-27. The marketing efforts will start within a 100 mile radius of Canyon. The efforts will include/outdoor advertising, both traditional and digital, regional printed media as well as local i.e. TEXAS program, Accent West. Also, the successful Shop and Dine brochure will receive a new design that can be used for printed material as well website information. The CEDC approved funding not to exceed $45,000. Funding will be disbursed from the CEDC Marketing Account (10%) into an account and segregated for the specific use of the campaign. Please find the attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution No It is the recommendation of staff to approve Resolution No

32 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT and CANYON MAIN STREET, A NON PROFIT CORPORATION duly organized and an existing business under the laws of the State of Texas and qualified to do business in Texas. 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are described as follows: a. Second party will develop a comprehensive marketing plan for Canyon and the Downtown Dining District b. Second party will conduct the campaign from March 2018-February 2019 c. Project benchmark include increase in Sales Tax Revenue 3. The CEDC will provide the following funding for the project: a. An amount, not to exceed $45,000 (1.) The amount of $45,000 will disbursed into an account specific and segregated for the allocated funds (2.) The funds are allocated from the CEDC Marketing Account (10% of Annual Revenue is set aside in this account for marketing purposes). (3.) Quarterly financial statements will be presented to the CEDC board members. (4.) Audit will be performed on or before April Page 1 of 6

33 b. All other terms and provisions of this agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: i approval of the financial incentives by the CEDC Board; ii approval of the financial incentives by the Canyon City Commission; and, iii compliance with the requirements of the Texas Development Corporation Act of 1979, ART B (4B, a-1) TEX. REV. CIV. STAT. 4. The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding and, at its option, to terminate this agreement by written notice delivered pursuant to paragraph Second Party agrees to undertake the following actions in order to accomplish the project: a. Comply at all times with the requirements of paragraph 2 of this agreement during the term of this agreement. 6. Second Party makes the following covenants and warranties to the CEDC and agrees to timely and fully perform the following obligations and duties: a. Any false or substantially misleading statement contained herein or the failure of Second Party to comply and fully perform as required in this agreement shall be an act of default by Second Party. Failure to comply with any covenant or warranties shall constitute an act of default and entitle the CEDC to suspend further funding and at it s option to terminate this agreement by written notice in accordance with paragraph 9 below. b. Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this agreement. c. No litigation or governmental proceeding is pending or to the knowledge of Second Party is contemplated or threatened against Second Party or affecting it s operations or business that may result in any material or adverse change in Second Party s business, properties, or operations. To Second Party s knowledge, no additional consent, approval, or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the transactions contemplated hereby. d. To Second Party s knowledge no certificate or statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. e. There are no bankruptcy proceedings or other legal proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. Page 2 of 6

34 f. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to carry on it s business in Texas and to perform the terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. g. The funds provided by CEDC shall be utilized solely for the purpose of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. h. Second Party shall pay all taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party s property and business operations. In addition, Second Party shall timely pay all employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities. i. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. j. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. k. Upon written request of CEDC Second Party shall notify CEDC in writing of substantial changes in the management of Second Party within seven (7) days. Substantial changes shall mean changes in executive officers, board members, or managers. l. The Second Party agrees that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 7. The CEDC under the following circumstances and at the sole discretion of its board of directors may suspend the obligations under this agreement or may terminate this agreement without liability to the CEDC upon: a. The filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any part of it s assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing. b. The adjudication of Second Party as a bankrupt. c. A change in ownership of Second Party which constitutes a material change in the nature of Second Party s business and operations, unless Second Party has complied with paragraph 2 and 3(d) above. 8. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 60 days after written notice by CEDC to Second Party, the CEDC may terminate this Page 3 of 6

35 agreement and pursue any legal remedies existing under the law; provided however, that Second Party s liability under this agreement shall be limited to the immediate return by Second Party of all funds or other economic incentives provided by the CEDC and any consideration previously paid to Second Party by the CEDC. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be 6% per annum. In the event CEDC should prevail in any litigation to recover funds pursuant to this paragraph, the CEDC shall, in addition to all other damages provided by this paragraph, be entitled to recover reasonable attorney s fees and expenses of litigation. Provided, however, that if the default relates only to the number of employees to be maintained under Paragraph 2.c., the sole remedy of the First Party shall be to reduce the amount paid as set forth in Paragraph 3.d. of this agreement. 9. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 10. Any delay by the CEDC in providing notice of default to Second Party, shall in no event be deemed or constitute a waiver of such default by CEDC or waiver of any of it s rights and remedies available under this agreement or at law or in equity. 11. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 12. Second Party specifically agrees that CEDC shall only be liable to Second Party for the amount of money actually budgeted and committed to the project described in this agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorneys fees, court costs, actual or consequential damages, direct or indirect, for any act of default by CEDC under the terms of this agreement. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the project cost out of its sales tax revenues held and administered pursuant to 4B of the Development Corporation Act for the fiscal year in which the funding under this agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed however, that in the event actual total sales tax revenues collected by CEDC for any year during which this agreement is to be performed should be less than the total amount of all grants to all contracting parties for that year, then in that event, CEDC shall fund projects in the order the grants were awarded after payment of CEDC s usual administrative cost and expenses. All contracting parties shall receive only their share of the available sales tax revenue for that year, less CEDC s customary and usual administrative costs and expenses and CEDC shall not be liable to any contracting party for any deficiency for that time or in the future. In the event of such revenue shortfall, CEDC will provide written notice to all contracting parties affected by the revenue shortfall along with such documentation as will allow the contracting party to ascertain their share of the funding to be provided. Page 4 of 6

36 13. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 14. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or its employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 15. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 16. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 17. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this agreement, consents to and waives any objections to in personam jurisdiction in Randall County, Texas. 18. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 19. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. Second Party agrees that, in compliance with this agreement, it will promptly comply with all applicable laws, regulations, orders, and rules of the state, city, and other governmental entities. 20. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. Provided however, that in the event Second Party transfers all or substantially all it s assets to another entity or merges with another entity to the extent that the underlying purpose of this agreement cannot, in the sole discretion of the CEDC s board of directors, be accomplished, the CEDC shall have the option to suspend it s performance under this agreement or terminate this agreement. 21. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Page 5 of 6

37 Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finder s fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 22. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. 23. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this agreement shall survive the original execution date of this agreement and shall constitute continuing obligations. Effective Date: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Don Lee, President Second Party: Canyon Main Street By: Evelyn Ecker, Executive Director Page 6 of 6

38 RESOLUTION NO RESOLUTION OF THE CITY COMMISSION OF THE CITY OF CANYON APPROVING A PROJECT FUNDING AGREEMENT BETWEEN THE CANYON ECONOMIC DEVELOPMENT CORPORATION AND CANYON MAIN STREET FOR FUNDING OF A TWELVE MONTH MARKETING CAMPAIGN FOR CANYON AND THE DOWNTOWN DINING DISTRICT. THE PLAN WOULD ENCOURAGE RETAIL SALES, HOTEL STAYS, AND GENERATE STATE AND LOCAL TAX REVENUE WHEREAS, on December 14, 2017, the Canyon Economic Development Corporation ( CEDC ) held a public hearing regarding the use of sales and use tax revenues collected pursuant to the Development Corporation Act of 1979 (Tex. Rev. Civ. Stat. Art B, ( the Act ) and to consider a funding agreement for the Canyon Main Street Marketing Plan for Canyon. The plan would encourage retail sales, hotel stays, and generate state and local tax revenue. WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to execute a Project Funding Agreement between the Canyon Economic Development Corporation and Canyon Main Street; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Mayor and City Clerk are hereby authorized to execute and attest, respectively, on behalf of the City of Canyon, Texas, a Project Funding Agreement between the Canyon Economic Development Corporation and Canyon Main Street; regarding the use of funds from the Sales Tax Improvement Fund (Fund40) for costs related to the project. INTRODUCED at the First Reading on the 8 th day of January 2018, and Adopted on the Second Reading on the 22 nd day of January, ATTEST: GARY HINDERS, MAYOR Gretchen Mercer, City Clerk

39 REGARDING ITEM 7 AGENDA To: Randy Criswell, City Manager From: Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2018 Re: Conduct Second Reading and Consider and Take Appropriate Action on Resolution No with Regards to a Request from Fox & Owl, LLC. dba Barrel & Pie For Direct Financial Assistance and Job Creation for a New Business Located at th Avenue, Ste. 101, Canyon, Texas. Barrel & Pie is a new food establishment that will be located in the 5 th Avenue Shops. The owners of the businesses are Kevin Friemel and Marcus Snead, both grew up in Canyon and wanted to return to their hometown to open a business. The new restaurant aims to provide unique, seasonally inspired pizza, small plates, and award winning desserts. Direct financial assistance and job incentive funds have been requested. The CEDC approved an amount not to exceed $95,000 over a two year period. The schedule is as follows: The first payment of $35,000 for direct financial assistance will be disbursed on the first day the business is open to the public. The second disbursement will occur on the one year anniversary of the business opening and contingent on reaching the goal of Gross Sales Revenue as projected in the Business Plan provided by owners. A one-time payment of $25,000 with direction toward job creation (four upper management positions). The disbursement will be made when payroll documentation is provided for the defined positions. Please find attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution No It is the recommendation of staff to approve Resolution No

40 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT Fox & Owl, LLC. (Barrel & Pie) This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT and Fox & Owl LLC., a duly organized corporation authorized under the laws of the State of Texas and qualified to do business in Texas. 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are described as follows: a. Second Party shall maintain the business located at th Avenue, Suite 101, Canyon, Texas. b. Second Party will maintain space as retail for a minimum of 5 years. 3. The CEDC will provide the following funding and financial incentives for the project: a. An amount, not to exceed $95,000 over a two year period, is as follows: (1.) The payment of $35,000 for direct financial assistance purchase of equipment will be disbursed on the first day the business is open to the public. (2.)The second payment of $35,000 for direct financial assistance will be made on the one year anniversary of business opening. The second payment is based on reaching the goal of Gross Sales Revenue as projected in the Business Plan provided by business owners. (3.)The payment of $25,000 with direction toward job creation for four (4) upper management positions. Disbursement will be made when payroll documentation is provide for the defined positions. Page 1 of 7

41 (4) Sales tax collected and business financials will be validated annually from the Effective date of the Funding Agreement. b. All other terms and provisions of this agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: i approval of the financial incentives by the CEDC Board; ii approval of the financial incentives by the Canyon City Commission; and, iii compliance with the requirements of the Texas Development Corporation Act of 1979, ART B (4B, a-1) TEX. REV. CIV. STAT. 4. The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding and, at its option, to terminate this agreement by written notice delivered pursuant to paragraph Second Party agrees to undertake the following actions in order to accomplish the project: a. Comply at all times with the requirements of paragraph 2 of this agreement during the term of this agreement. 6. Second Party makes the following covenants and warranties to the CEDC and agrees to timely and fully perform the following obligations and duties: a. Any false or substantially misleading statement contained herein or the failure of Second Party to comply and fully perform as required in this agreement shall be an act of default by Second Party. Failure to comply with any covenant or warranties shall constitute an act of default and entitle the CEDC to suspend further funding and at it s option to terminate this agreement by written notice in accordance with paragraph 9 below. b. Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this agreement. c. No litigation or governmental proceeding is pending or to the knowledge of Second Party is contemplated or threatened against Second Party or affecting it s operations or business that may result in any material or adverse change in Second Party s business, properties, or operations. To Second Party s knowledge, no additional consent, approval, or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the transactions contemplated hereby. Page 2 of 7

42 d. To Second Party s knowledge no certificate or statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. e. There are no bankruptcy proceedings or other legal proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. f. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to carry on it s business in Texas and to perform the terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. g. The funds provided by CEDC shall be utilized solely for the purpose of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. h. Second Party shall pay all taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party s property and business operations. In addition, Second Party shall timely pay all employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities. i. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. j. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. k. Upon written request of CEDC Second Party shall notify CEDC in writing of substantial changes in the management of Second Party within seven (7) days. Substantial changes shall mean changes in executive officers, board members, or managers. l. The Second Party agrees that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 7. The CEDC under the following circumstances and at the sole discretion of its board of directors may suspend the obligations under this agreement or may terminate this agreement without liability to the CEDC upon: a. The filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any part of its assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing. Page 3 of 7

43 b. The adjudication of Second Party as a bankrupt. c. A change in ownership of Second Party which constitutes a material change in the nature of Second Party s business and operations, unless Second Party has complied with paragraph 2 and 3(d) above. 8. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 60 days after written notice by CEDC to Second Party, the CEDC may terminate this agreement and pursue any legal remedies existing under the law; provided however, that Second Party s liability under this agreement shall be limited to the immediate return by Second Party of all funds or other economic incentives provided by the CEDC and any consideration previously paid to Second Party by the CEDC. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be 6% per annum. In the event CEDC should prevail in any litigation to recover funds pursuant to this paragraph, the CEDC shall, in addition to all other damages provided by this paragraph, be entitled to recover reasonable attorney s fees and expenses of litigation. Provided, however, that if the default relates only to the number of employees to be maintained under Paragraph 2.c., the sole remedy of the First Party shall be to reduce the amount paid as set forth in Paragraph 3.d. of this agreement. 9. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 10. Any delay by the CEDC in providing notice of default to Second Party, shall in no event be deemed or constitute a waiver of such default by CEDC or waiver of any of it s rights and remedies available under this agreement or at law or in equity. 11. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 12. Second Party specifically agrees that CEDC shall only be liable to Second Party for the amount of money actually budgeted and committed to the project described in this agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorneys fees, court costs, actual or consequential damages, direct or indirect, for any act of default by CEDC under the terms of this agreement. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the project cost out of its sales tax revenues held and administered pursuant to 4B of the Development Corporation Act for the fiscal year in which the funding Page 4 of 7

44 under this agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed however, that in the event actual total sales tax revenues collected by CEDC for any year during which this agreement is to be performed should be less than the total amount of all grants to all contracting parties for that year, then in that event, CEDC shall fund projects in the order the grants were awarded after payment of CEDC s usual administrative cost and expenses. All contracting parties shall receive only their share of the available sales tax revenue for that year, less CEDC s customary and usual administrative costs and expenses and CEDC shall not be liable to any contracting party for any deficiency for that time or in the future. In the event of such revenue shortfall, CEDC will provide written notice to all contracting parties affected by the revenue shortfall along with such documentation as will allow the contracting party to ascertain their share of the funding to be provided. 13. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 14. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or its employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 15. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 16. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 17. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this agreement, consents to and waives any objections to in personam jurisdiction in Randall County, Texas. 18. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 19. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. Second Party agrees that, in compliance with this agreement, it Page 5 of 7

45 will promptly comply with all applicable laws, regulations, orders, and rules of the state, city, and other governmental entities. 20. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. Provided however, that in the event Second Party transfers all or substantially all it s assets to another entity or merges with another entity to the extent that the underlying purpose of this agreement cannot, in the sole discretion of the CEDC s board of directors, be accomplished, the CEDC shall have the option to suspend it s performance under this agreement or terminate this agreement. 21. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finder s fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 22. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. 23. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this agreement shall survive the original execution date of this agreement and shall constitute continuing obligations. Page 6 of 7

46 Effective Date: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Don Lee, President th Avenue, Suite 21, Canyon, Texas FOX & OWL, LLC. By: Kevin Friemel, Managing Partner By: Marcus Snead, Managing Partner Page 7 of 7

47 RESOLUTION NO APPROVING PROJECT FUNDING AGREEMENT BETWEEN THE CANYON ECONOMIC DEVELOPMENT CORPORATION AND FOX & OWL, LLC. FOR DIRECT FINANCIAL ASSISTANCE AND JOB CREATION FOR A NEW BUSINESS LOCATED AT TH AVENUE, SUITE 101, CANYON. THE NEW BUSINESS WOULD ENCOURAGE RETAIL SALES AND GENERATE STATE AND LOCAL TAX REVENUE. WHEREAS, on December 14, 2017, the Canyon Economic Development Corporation ( CEDC ) held a public hearing regarding the use of sales and use tax revenues collected pursuant to the Development Corporation Act of 1979 (Tex. Rev. Civ. Stat. Art B, ( the Act ) and to consider a funding agreement for the expansion of the Rack Boutique. The project would encourage retail sales and generate state and local tax revenue. WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to execute a Project Funding Agreement between the Canyon Economic Development Corporation and Fox & Owl LLC., ; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Mayor and City Clerk are hereby authorized to execute and attest, respectively, on behalf of the City of Canyon, Texas, a Project Funding Agreement between the Canyon Economic Development Corporation and Fox & Owl, LLC., ; regarding the use of funds from the Sales Tax Improvement Fund (Fund40) for costs related to the project. INTRODUCED at the First Reading on the 8 th day of January, 2018, and Adopted on the Second Reading on the 22 nd day of January, ATTEST: GARY HINDERS, MAYOR Gretchen Mercer, City Clerk

48 REGARDING ITEM 8 AGENDA To: From: Randy Criswell, City Manager Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: January 16, 2016 Re: Conduct Second Reading and Consider and Take Appropriate Action on Resolution No With Regards to a Request From Rocar Inc., dba U.S. Cleaners, a New Business to be located at 2005 N. 2 nd Avenue, Ste A., (The Depot) Canyon, Texas. The Funding is Based on New Business Development. U.S. Cleaners has been a family owned and operated business since The business started with one location and has grown to 5. Last year they built a state of the art production facility with four satellite locations across Amarillo. They believe the timing is right to expand into the Canyon market. U.S Cleaners goal is to bring quality dry cleaning services, quick turnaround times, 24 hour drop off, and the convenience of a drive-through. Also the Amarillo locations have a significant customer base from Canyon and they would like to be more convenient for that those consumers. The CEDC approved funding Lease Subsidy for 3 years. The funding schedule would be 50% the first year, 30% second year and 20% the last year. Funding would not exceed $18,666. U.S. Cleaners has signed a three (3) year lease on the space. Please find attached the Resolution and a draft of the Funding Agreement. This is the second and final reading of Resolution No It is the recommendation of staff to approve Resolution No

49 CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT Rocar Inc. dba U.S. Cleaners This agreement is made by and between the Canyon Economic Development Corporation (CEDC), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT Rocar Inc., dba U.S. Cleaners duly organized and an existing business under the laws of the State of Texas and qualified to do business in Texas. 1. The purpose of this agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under TEX. REV. CIV. STAT. ART B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. The project and performance requirements to be implemented by means of this agreement are described as follows: a. Second Party shall maintain the business located at 2005 N. 2 nd Avenue, Canyon, Texas. b. Second Party will maintain space as retail for a minimum of 3 years. The definition of retail is defined as consistent business hours Monday Saturday. 3. The CEDC will provide the following funding and financial incentives for the project: a. An amount, not to exceed $18, as follows: (1.) The payment of $9, ($ month) for Lease Subsidy for one year only (year 1). Lease will be reimbursed and paid in arrears. Start day will be the first full month store is open for business. A copy of the lease will be provided. (2.) The payment of $5, ($ month) for Lease Subsidy for the 2 nd year. (3) The payment of $3, ($ monthly) for Lease Subsidy for the 3 rd year. Page 1 of 7

50 (4) Sales tax collected and business financials will be validated annually from the Effective date of the Funding Agreement. b. All other terms and provisions of this agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: i approval of the financial incentives by the CEDC Board; ii approval of the financial incentives by the Canyon City Commission; and, iii compliance with the requirements of the Texas Development Corporation Act of 1979, ART B (4B, a-1) TEX. REV. CIV. STAT. 4. The failure of Second Party to fully and timely comply with any performance requirement shall be an act of default by Second Party which shall entitle the CEDC to suspend further funding and, at its option, to terminate this agreement by written notice delivered pursuant to paragraph Second Party agrees to undertake the following actions in order to accomplish the project: a. Comply at all times with the requirements of paragraph 2 of this agreement during the term of this agreement. 6. Second Party makes the following covenants and warranties to the CEDC and agrees to timely and fully perform the following obligations and duties: a. Any false or substantially misleading statement contained herein or the failure of Second Party to comply and fully perform as required in this agreement shall be an act of default by Second Party. Failure to comply with any covenant or warranties shall constitute an act of default and entitle the CEDC to suspend further funding and at it s option to terminate this agreement by written notice in accordance with paragraph 9 below. b. Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this agreement. c. No litigation or governmental proceeding is pending or to the knowledge of Second Party is contemplated or threatened against Second Party or affecting it s operations or business that may result in any material or adverse change in Second Party s business, properties, or operations. To Second Party s knowledge, no additional consent, approval, or authorization of a governmental entity or other authority is required in connection with the execution and performance of this agreement or the transactions contemplated hereby. d. To Second Party s knowledge no certificate or statement delivered by Second Party to CEDC in connection with this agreement or any transaction contemplated by this agreement contains any untrue statement or fails to state the facts necessary to keep the statements contained therein from being misleading or false. Page 2 of 7

51 e. There are no bankruptcy proceedings or other legal proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. f. To it s knowledge Second Party has acquired and maintained all necessary rights, licenses, permits, and authority to carry on it s business in Texas and to perform the terms of this agreement and will continue to use it s best efforts to maintain all necessary rights, licenses, and permits in current status and good standing. g. The funds provided by CEDC shall be utilized solely for the purpose of the project as stated in this agreement and within the scope of the project as stated in this agreement and for no other purpose. h. Second Party shall pay all taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party s property and business operations. In addition, Second Party shall timely pay all employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities. i. Second Party shall complete the project required by this agreement and shall provide the necessary staff and employees for the completion and performance of this agreement. j. Second Party shall timely and fully perform and comply with all terms and conditions of this agreement. k. Upon written request of CEDC Second Party shall notify CEDC in writing of substantial changes in the management of Second Party within seven (7) days. Substantial changes shall mean changes in executive officers, board members, or managers. l. The Second Party agrees that with regard to all programs and activities arising out of this agreement, the Second Party shall fully comply with all civil rights acts and specifically will not discriminate against any person upon the basis of race, color, national origin, gender, or by reason of being disabled. 7. The CEDC under the following circumstances and at the sole discretion of its board of directors may suspend the obligations under this agreement or may terminate this agreement without liability to the CEDC upon: a. The filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any part of it s assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing. b. The adjudication of Second Party as a bankrupt. Page 3 of 7

52 c. A change in ownership of Second Party which constitutes a material change in the nature of Second Party s business and operations, unless Second Party has complied with paragraph 2 and 3(d) above. 8. Should Second Party fail to timely, fully, and completely comply with any one or more of the requirements, obligations, duties, terms, and conditions or warranties of this agreement such failure shall constitute an act of default by Second Party and, if not fully and completely cured within 60 days after written notice by CEDC to Second Party, the CEDC may terminate this agreement and pursue any legal remedies existing under the law; provided however, that Second Party s liability under this agreement shall be limited to the immediate return by Second Party of all funds or other economic incentives provided by the CEDC and any consideration previously paid to Second Party by the CEDC. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be 6% per annum. In the event CEDC should prevail in any litigation to recover funds pursuant to this paragraph, the CEDC shall, in addition to all other damages provided by this paragraph, be entitled to recover reasonable attorney s fees and expenses of litigation. Provided, however, that if the default relates only to the number of employees to be maintained under Paragraph 2.c., the sole remedy of the First Party shall be to reduce the amount paid as set forth in Paragraph 3.d. of this agreement. 9. In the event of unforeseeable third party delays, in the performance of this agreement by Second Party, or force majeure, and upon a reasonable showing by Second Party that it has immediately and in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC may consent and excuse any such delay, which consent shall not be unreasonably conditioned or withheld. The failure by Second Party to continuously and diligently pursue compliance shall constitute an act of default. 10. Any delay by the CEDC in providing notice of default to Second Party, shall in no event be deemed or constitute a waiver of such default by CEDC or waiver of any of it s rights and remedies available under this agreement or at law or in equity. 11. Any waiver provided by CEDC to Second Party of an act of default shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future act of default by Second Party even if the act or default is of the same or a similar nature. 12. Second Party specifically agrees that CEDC shall only be liable to Second Party for the amount of money actually budgeted and committed to the project described in this agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorneys fees, court costs, actual or consequential damages, direct or indirect, for any act of default by CEDC under the terms of this agreement. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the project cost out of its sales tax revenues held and administered pursuant to 4B of the Development Corporation Act for the fiscal year in which the funding under this agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed however, that in the event actual total sales tax revenues collected by CEDC for any year during which this agreement is to be performed should be less Page 4 of 7

53 than the total amount of all grants to all contracting parties for that year, then in that event, CEDC shall fund projects in the order the grants were awarded after payment of CEDC s usual administrative cost and expenses. All contracting parties shall receive only their share of the available sales tax revenue for that year, less CEDC s customary and usual administrative costs and expenses and CEDC shall not be liable to any contracting party for any deficiency for that time or in the future. In the event of such revenue shortfall, CEDC will provide written notice to all contracting parties affected by the revenue shortfall along with such documentation as will allow the contracting party to ascertain their share of the funding to be provided. 13. This agreement incorporates the entire agreement of the parties hereto and supersedes any oral or written previous and contemporaneous agreements between the parties relating to the matters covered by this agreement. Except as otherwise provided herein, this agreement cannot be modified or amended without a written agreement of the parties. 14. No term or provision of this agreement or an act of the CEDC in the performance of this agreement shall be construed as making or constituting Second Party or its employees, or agents, partners of the CEDC or employees of the CEDC. This contract shall not benefit any third party not a direct party to this agreement. 15. The termination of this agreement as provided herein may be upon mutual agreement of the parties or pursuant to the provisions hereof relating to default. The termination of this agreement either by mutual agreement or by notice served by the CEDC shall extinguish all rights, duties, and obligations of the CEDC and Second Party except as provided herein. 16. This agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution and shall constitute the same instrument. 17. This agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas without regard to any conflict of laws provision. Venue in any litigation arising out of the execution or performance of this agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this agreement, consents to and waives any objections to in personam jurisdiction in Randall County, Texas. 18. In the event one or more of the provisions contained in this agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this agreement. This agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. 19. This agreement is subject to all legal requirements contained in the Municipal Charter of the City of Canyon and Code and Ordinances of the City of Canyon and all other applicable state and federal laws and regulations. Second Party agrees that, in compliance with this agreement, it will promptly comply with all applicable laws, regulations, orders, and rules of the state, city, and other governmental entities. Page 5 of 7

54 20. This agreement shall be binding upon the parties hereto, their successors, and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned. Provided however, that in the event Second Party transfers all or substantially all it s assets to another entity or merges with another entity to the extent that the underlying purpose of this agreement cannot, in the sole discretion of the CEDC s board of directors, be accomplished, the CEDC shall have the option to suspend it s performance under this agreement or terminate this agreement. 21. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this agreement or participation in the negotiation or formation of this agreement. No finder s fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this agreement. 22. All notices from one party to the other party required or permitted by this agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this agreement. 23. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this agreement shall survive the original execution date of this agreement and shall constitute continuing obligations. Page 6 of 7

55 Effective Date: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Don Lee, President th Avenue, Suite 21, Canyon, Texas ROCAR Inc. By: Caron Turner Sansing, President 4303 Criss Street, Amarillo, Texas Page 7 of 7

56 RESOLUTION NO RESOLUTION OF THE CITY COMMISSION OF THE CITY OF CANYON APPROVING PROJECT FUNDING AGREEMENT BETWEEN ROCAR INC., AND CANYON ECONOMIC DEVELOPMENT CORPORATION REGARDING DIRECT FINANCIAL ASSISTANCE FOR A PROJECT LOCATED AT 2005 N. 2 nd AVENUE, SUITE A, CANYON, TEXAS. THE FUNDING IS BASED ON NEW BUSINESS DEVELOPMENT. WHEREAS, on DECEMBER 14, 2017, the Canyon Economic Development Corporation ( CEDC ) conducted a public hearing regarding the use of sales and use tax revenues collected pursuant to the Development Corporation Act of 1979 (Tex. Rev. Civ. Stat. Art B, ( the Act ) and to consider a funding agreement for the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to execute a Project Funding Agreement between the Canyon Economic Development Corporation and Rocar Inc., a registered entity qualified to do business in Texas. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS: That the Project Funding Agreement by and between CEDC and Rocar Inc., be, and it is hereby approved, and the sales tax revenue collected pursuant to the Act by CEDC may be used for the primary purpose of financial assistance for new business development. The sales tax revenue referred to in this Resolution shall be the revenue on deposit in Sales Tax Improvement Fund (Fund 40) for direct costs related to the project. INTRODUCED at the First Reading on the 8 th of January 2018, and Adopted on the Second Reading on the 22 nd of January, ATTEST: GARY HINDERS, MAYOR Gretchen Mercer, City Clerk

57 REGARDING ITEM 9 AGENDA To: From: Randy Criswell, City Manager Chris Sharp, Assistant City Manager Date: January 15, 2018 Re: Consider and Take Appropriate Action on City of Canyon s Investment Policy Pursuant to Chapter 2256 of the Local Government Code, we are presenting you with an Investment Policy for the City. Annually the Commission reviews and approves this policy. We have made a few changes to our policy to reflect some minor changes in the law. There are no major changes that have been made. It is staff s recommendation that the Commission approve the Investment Policy. City of Canyon

58 INVESTMENT POLICY I. POLICY It is the policy of the City of Canyon (the City ) that after allowing for the anticipated cash flow requirements of the City and giving due consideration to the safety and risk of investment, all available funds shall be invested in conformance with these legal and administrative guidelines, seeking to optimize interest earnings to the maximum extent possible. Effective cash management is recognized as essential to good fiscal management. Investment interest is a source of revenue to the City. The City s investment portfolio shall be designed and managed in a manner designed to maximize this revenue source, to be responsive to public trust, and to be in compliance with legal requirements and limitations. Investments shall be made with the primary objectives of: Safety and preservation of principal Maintenance of sufficient liquidity to meet operating needs Public trust from prudent investment activities Optimization of interest earnings on the portfolio II. PURPOSE The purpose of this investment policy is to comply with Chapter 2256 of the Government Code ( Public Funds Investment Act ), which requires the City to adopt a written investment policy regarding the investment of its funds and funds under its control. The Investment Policy addresses the methods, procedures and practices that must be exercised to ensure effective and judicious fiscal management of the City s funds. III. SCOPE This Investment Policy shall govern the investment of all financial assets of the City. These funds are accounted for in the City s Comprehensive Annual Financial Report (CAFR) and include: General Fund Water Works & Sewer System Fund Golf Course Fund C.E.D.C. Funds W/S Bond Funds Emergency Management Fund Library Gift and Memorial Fund 1

59 Board of City Development Fund LEOSE Fund D-Fi-It Program Employee Flower Fund Vol. Firemen s Funds All subsidiary funds and any new fund created unless specifically exempted The City may consolidate cash balances from all funds to manage bank service needs and enhance investment earnings. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles. This Investment Policy shall apply to all transactions involving the financial assets and related activity for all the foregoing funds. IV. INVESTMENT OBJECTIVES The City shall manage and invest its cash with four primary objectives, listed in order of priority: safety, liquidity, public trust, and yield, expressed as optimization of interest earnings. The safety of the principal invested always remains the primary objective. All investments shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. The City shall maintain a comprehensive cash management program, which includes collection of account receivables, vendor payments in accordance with invoice terms, and prudent investment of available cash. Cash management is defined as the process of managing monies in order to insure adequate cash availability and optimum earnings on short-term investment of idle cash. Safety [PFIA (b)(2)] Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit and interest rate risk. Credit Risk The City will minimize credit risk, the risk of loss due to the failure of the issuer or backer of the investment, by: Limiting investments to the safest types of investments Pre-qualifying the financial institutions and broker/dealers with which the City will do business Diversifying issuer credit risk, when appropriate, so that potential losses on individual issuers will be minimized. Interest Rate Risk the City will minimize the risk that the interest earnings and the market value of investments in the portfolio will fall due to changes in general interest rates, by: 2

60 Structuring the investment portfolio so that investments mature to meet cash requirements for ongoing operations, thereby avoiding the need to liquidate investments prior to maturity. Investing operating funds primarily in certificates of deposit, shorterterm securities, money market mutual funds, or local government investment pools functioning as money market mutual funds. Diversifying maturities and staggering purchase dates to minimize the impact of market movements over time. Utilizing any other method of investment management allowable by the Public Funds Investment Act deemed most advantageous based on current market conditions. Liquidity [PFIA (b)(2)] The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that investments mature concurrent with cash needs to meet anticipated demands. Public Trust All participants in the City s investment process shall seek to act responsibly as custodians of the public trust. Investment officers shall avoid any transaction that might impair public confidence in the City s ability to govern effectively. Yield (Optimization of Interest Earnings) [PFIA (b)(3)] The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. V. RESPONSIBILITY AND CONTROL Delegation of Authority [PFIA (f)] The City Commission designates the City Manager as the Chief Financial Officer, and he/she and the Director of Finance as the City s Investment Officers. An Investment Officer is authorized to execute investment transactions on behalf of the City. No person may engage in an investment transaction or the management of City funds except as provided under the terms of this Investment Policy as approved by the City Commission. The investment authority granted to the Investment Officers is effective until rescinded by the City Commission. Quality and Capability of Investment Management [PFIA (b)(3)] 3

61 The City shall provide periodic training in investments for the designated Investment Officers and other investment personnel through courses and seminars offered by professional organizations, associations, and other independent sources in order to insure the quality and capability of investment management in compliance with the Public Funds Investment Act. Training Requirement (PFIA ) In accordance with the Public Funds Investment Act, Investment Officers shall attend investment training no less often than once every two years, aligned with the City s fiscal year end, and shall accumulate not less than 8 hours of instruction relating to investment responsibilities. A newly appointed Investment Officer must attend training accumulating at least 10 hours of instruction within twelve months of the date the officer took office or assumed the officer s duties. Approved training sources include: Government Finance Officers Association Government Finance Officers Association of Texas Government Treasurers Organization of Texas Texas Municipal League University of North Texas Internal Controls (Best Practice) The Chief Financial Officer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. Accordingly, the Chief Financial Officer shall establish a process for annual independent review by the external auditor to assure compliance with policies and procedures. The internal controls shall address the following points. Control of collusion. Separation of transactions authority from accounting and record keeping. Custodial safekeeping. Clear delegation of authority to subordinate staff members. Written confirmation for telephone (voice) transactions for investments and wire transfers, and Development of a wire transfer agreement with the depository band or third-party custodian Prudence (PFIA ) 4

62 The standard of prudence to be applied by the Investment Officer shall be the prudent investor rule. This rule states that Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. In determining whether an Investment Officer has exercised prudence with respect to an investment decision, the determination shall be made taking into consideration: The investment of all funds, or funds under the City s control, over which the officer had responsibility rather than a consideration as to the prudence of a single investment. Whether the investment decision was consistent with the written approved investment policy of the City. Indemnification (Best Practice) The Investment Officer, acting in accordance with written procedures and exercising due diligence, shall not be held personally responsible for a specific investment s credit risk or market price changes, provided that these deviations are reported immediately and the appropriate action is taken to control adverse developments. Ethics and Conflicts of Interest [PFIA (i)] Investment Officers and employees involved in the investment process shall refrain from personal business activity that would conflict with the proper execution and management of the investment program, or that would impair their ability to make impartial decisions. Employees and Investment Officers shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/investment positions that could be related to the performance of the investment portfolio. Employees and Investment Officers shall refrain from undertaking personal investment transactions with the same individual with which business is conducted on behalf of the City. An Investment Officer of the City who has a personal business relationship with an organization seeking to sell an investment to the City shall file a statement disclosing that personal business interest. An Investment Officer who is related within the second degree by affinity or consanguinity to an individual seeking to sell an investment to the City shall file a statement disclosing that relationship. A statement required under this subsection must be filed with the Texas Ethics Commission and the City Commission. VI. SUITABLE AND AUTHORIZED INVESTMENTS Portfolio Management 5

63 The City currently has a buy and hold portfolio strategy. Maturity dates are matched with cash flow requirements and investments are purchased with the intent to be held until maturity. However, investments may be liquidated prior to maturity for the following reasons: An investment with declining credit may be liquidated early to minimize loss of principal. Cash flow needs of the City require that the investment be liquidated. Investments [PFIA (b)(4)(A)] City funds governed by this Policy may be invested in the instruments described below, all of which are authorized by the Public Funds Investment Act. Investment of City funds in any instrument or security not authorized for investment prohibited. The City will not be required to liquidate an investment that becomes unauthorized subsequent to its purchase. I. Authorized 1. Obligations, including letters of credit, of the United States of America or its agencies and instrumentalities, including the Federal Home Loan Banks. 2. Certificates of Deposit, and other forms of deposit, placed with a bank or other approved financial institution organized under Texas law, the laws of another state, or federal law, that has its main office or a branch office in Texas, and that is guaranteed or insured by the Federal Deposit Insurance Corporation or its successor, or secured by obligations in a manner and amount provided by law for deposits of the City. 3. Money Market Mutual Funds that are 1) registered and regulated by the Securities and Exchange Commission, 2) managed in compliance with money market fund regulations, 3) rated AAA by at least one nationally recognized rating service, and 4) seek to maintain a stable net asset value of $ per share. 4. Local government investment pools, which 1) meet the requirements of Chapter of the Public Funds Investment Act, 2) are rated no lower than AAA or an equivalent rating by at least one nationally recognized rating service, 3) seek to maintain a $1.00 net asset value, and 4) are authorized by resolution or ordinance by the City Commission. 5. Certificates of Deposit and Money Market Accounts through cooperative programs such as CDARS (Certificates of Deposit Account Registry Service) and ICS (Insured Cash Sweep) which spread deposits to provide $250,000 FDIC Insurance Coverage per Financial Institution and insure the total deposit. 6

64 6. Obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less than A or its equivalent. It is the policy of the City to provide a competitive environment for all individual investment purchases and sales, and financial institution, money market mutual fund, and local government investment pool selections. All security transactions shall be executed using the delivery versus payment method. That is, funds shall not be wired or paid until verification has made that the correct security was received by the City s safekeeping agent. The City shall contract with a bank or banks for the safekeeping of securities owned by the City as part of its investment portfolio. Securities owned by the City shall be held in the City s account as evidenced by safekeeping receipts of the institution holding the securities. Safekeeping institutions shall be independent from the parties involved in the investment transaction. All prudent measures will be taken to liquidate an investment that is downgraded to less than the required minimum rating. (PFIA ) II. Not Authorized [PFIA (b)(1-4)] Investments including interest-only or principal-only strips of obligations with underlying mortgage-backed security collateral, and collateralized mortgage obligations with an inverse floating interest rate or a maturity date of over 10 years are strictly prohibited. VII. INVESTMENT PARAMETERS Maximum Maturities [PFIA (b)(4)(B)] The longer the maturity of investments, the greater their price volatility. Therefore, it is the City s policy to concentrate its investment portfolio in shorter-term investments in order to limit principal risk caused by changes in interest rates. The City attempts to match its investments with anticipated cash flow requirements. The City will not directly invest in investments maturing more than three (3) years from the date of purchase; however, the above described obligations, certificates, or agreements may be collateralized using longer dated investments. Diversification [PFIA (b)(3)] The City recognizes that investment risks can result from issuer defaults, market price changes or various technical complications leading to temporary illiquidity. Risk is controlled through portfolio diversification that shall be achieved by the following general guidelines: 7

65 Limiting investments to avoid overconcentration in a specific issuer or business sector (excluding those deposit that are fully insured and collateralized in accordance with state and federal law), Restricting/prohibiting investments that have higher credit risks (example: commercial paper), Investing in varying maturities, and Continuously investing a portion of the portfolio in cash equivalent options such as local government investment pools (LGIPs), money market funds, or interestbearing demand or money market depository accounts to ensure that appropriate liquidity is maintained in order to meet ongoing obligations. Investment Policy Certification All local government investment pools and discretionary investment management firms must sign a certification acknowledging that the organization has received and reviewed the City s Investment Policy, and that reasonable procedures and controls have been implemented to preclude investment transactions that are not authorized by the City s Policy in accordance with the PFIA. Authorized Broker/Dealers The City shall, at least annually, review, revise, and adopt a list of qualified broker/dealers authorized to engage in securities transactions with the City. Authorized firms include primary dealers or secondary dealers that qualify under Securities & Exchange Commission Rule 15C3-1 (Uniform Net Capital Rule). The Authorized Broker/Dealer list is attached in Appendix A. Depositories The City will select and designate a qualified primary bank depository in compliance with State law and the City s purchasing policy. Additionally, the City may utilize other depository institutions to expand deposit placement opportunities or provide specialty services. All depository balances shall be insured or collateralized in compliance with applicable State law. The City reserves the right, in its sole discretion, to accept or reject any form of insurance or collateralization pledged towards depository deposits. Depositories will be required to sign an Agreement with the City. The Agreement shall address any concerns in relation to acceptable collateral, levels of collateral, substitution and addition of collateral, and reporting and monitoring of collateral. The collateralized deposit portion of the Agreement shall define the City s rights to the collateral in case of default, bankruptcy, or closing, and shall establish a perfected security interest in compliance with Federal and State regulations, including: The Agreement must be in writing; 8

66 The Agreement has to be executed by the Depository and the City contemporaneously with the acquisition of the asset; The Agreement must be approved by the Board of Directors or Designated Committee of the Depository and a copy of the meeting minutes must be delivered to the City; and The Agreement must be part of the Depository s official record continuously since its execution. Collateral will be held by a third-party custodian designated by the City and pledged to the City as evidenced by pledge receipts of the institution with which the collateral is deposited. Original pledge receipts shall be obtained. Collateral may be held by a Federal Reserve Bank or branch of a Federal Reserve Bank, a Federal Home Loan Bank, or a third party bank approved by the City and eligible under State law. Methods VIII. REPORTING (PFIA ) The Investment Officers shall prepare an investment report on a quarterly basis that summarizes investment strategies employed in the most recent quarter and describes the portfolio in terms of investments and maturities, and shall explain the total investment return for the quarter. The quarterly investment report shall include a summary statement that will allow the City to ascertain whether investment activities during the reporting period have conformed to the Investment Policy. The report will be provided to the City Commission. The report will include the following: A listing of individual investments held at the end of the reporting period. Unrealized gains or losses resulting from appreciation or depreciation by listing the beginning and ending book and market value of investments for the period. Additions and changes to the market value during the period. Average weighted yield to maturity of portfolio as compared to applicable benchmark. Listing of investments by maturity date. Fully accrued interest for the reporting period. The percentage of the total portfolio that each type of investment represents. Statement of compliance of the City s investment portfolio with state law and the investment strategy and policy approved by the City Commission. Signatures of each Investment Officer. The market value of the portfolio will be calculated, and investment credit ratings will be confirmed on a quarterly basis in compliance with the reporting requirements. In determining market value and credit ratings, sources independent of the investment provider will be pursued. 9

67 Weighted average yield to maturity shall be the standard on which investment performance is calculated. As a function of the annual audit, the quarterly investment reports shall be reviewed by the external auditor and the results of that review provided to the City Commission. IX. INVESTMENT STRATEGIES Operating Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for Operating Funds. Safety of Principal - All investments shall be of high quality with no perceived default risk. Market price fluctuations may occur. However, by managing the weighted average days to maturity for the Operating Fund s portfolio to less than 270 days and restricting the maximum allowable maturity to two years, the price volatility of the overall portfolio will be minimized. Marketability - Securities with active and efficient secondary markets are necessary in the event of an unanticipated cash flow requirement. Liquidity - The Operating Funds requires the greatest short-term liquidity of any of the Fund types. Cash equivalent investments will provide daily liquidity and may be utilized as a competitive yield alternative to fixed maturity investments. Diversification - Investment maturities should be staggered throughout the budget cycle to provide cash flow based on the anticipated operating needs of the City. Market cycle risk will be reduced by diversifying the appropriate maturity structure out through two years. Yield - Attaining a competitive market yield for comparable investment-types and portfolio restrictions is the desired objective. The yield of an equally weighted, rolling three-month Treasury Bill portfolio will be the minimum yield objective. Construction and Capital Improvement Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for Construction and Capital Improvement Funds. Safety of Principal All investments will be of high quality with no perceived default risk. Market fluctuations may occur. However, by restricting the maximum maturity to the lesser of the anticipated cash flow requirements, three years or the IRS defined temporary period, the market risk of the portfolio will be minimized. 10

68 Marketability - The balancing of short-term and long-term cash flow needs requires the Construction and Capital Improvement Funds portfolio to have securities with active and efficient secondary markets. Liquidity - Construction and Capital Improvement Funds used as part of a CIP plan or scheduled repair and replacement program are reasonably predictable. However, unanticipated needs or emergencies may arise. Maintaining minimum cash equivalent investment amounts will reduce the liquidity risk of unanticipated expenditures. Diversification - Investment maturities should blend the short-term and long-term cash flow needs to provide adequate liquidity, yield enhancement and stability. A barbell maturity ladder may be appropriate. Yield - Attaining a competitive market yield for comparable investment-types and portfolio structures is the desired objective. The yield of an equally weighted, rolling six-month Treasury Bill portfolio will be the minimum yield objective. Debt Service Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for the Debt Service Fund. Safety of Principal - All investments shall be of high quality with no perceived default risk. Market price fluctuations may occur. However, by managing Debt Service Funds to not exceed the debt service payment schedule, the market risk of the overall portfolio will be minimized. Marketability - Securities with active and efficient secondary markets are not necessary as the event of an unanticipated cash flow requirement is not probable. Liquidity - Debt Service Funds have predictable payment schedules. Therefore, investment maturities should not exceed the anticipated cash flow requirements. Cash equivalent investments may provide a competitive yield alternative for short term fixed maturity investments. Diversification - Market conditions influence the attractiveness of fully extending maturity to the next unfunded payment date. Generally, if investment rates are anticipated to decrease over time, the City is best served by locking in most investments. If the interest rates are potentially rising, then investing in shorter and larger amounts may provide advantage. At no time shall the debt service schedule be exceeded in an attempt to bolster yield. Yield - Attaining a competitive market yield for comparable investment-types and portfolio restrictions is the desired objective. The yield of an equally weighted, rolling three-month Treasury Bill portfolio shall be the minimum yield objective. 11

69 X. INVESTMENT POLICY ADOPTION [PFIA (e)] The City s investment policy shall be adopted by resolution of the City Commission. It is the City s intent to comply with state laws and regulations. The City s investment policy shall be subject to revisions consistent with changing laws, regulations, and needs of the City. The City Commission shall adopt a resolution stating that it has reviewed the policy and investment strategies annually, approving any changes or modifications. XI. FUND BALANCE A. Definitions - In compliance with the Government Accounting Standard Board (GASB) Statement No. 54, the City has adopted the following definitions: 1. Non-spendable fund balance (inherently not spendable) Includes amounts that will never convert to cash or will not convert to cash in the current period, such as inventory, supplies, long-term portion of loans and non-financial assets held for resale or principal of an endowment. 2. Restricted fund balance (externally enforceable limitations on use) Includes amounts that can be spent only for the specific purposes stipulated by external resource providers either constitutionally or through enabling legislation. Examples include grants, court receipt restrictions (municipal technology fund) or charter restrictions. 3. Committed fund balance (self-imposed limitations) Includes amounts that can be used for the specific purposes determined by a formal action of the City Commission in form of a resolution. Commitments may be changed or lifted only by taking the same formal action that imposed the constraints originally. 4. Assigned fund balance (limitation resulting from management s intended use) Comprises amounts intended to be used for a specific purpose, as expressed by City Commission, by a designated official or committee. By adopting this policy, the City Commission has hereby authorized the City Manager as the official to assign fund balance to a specific purpose. In governmental funds other than the general fund, assigned fund balance represents the amount that is not restricted or committed, as it is intended to be used for the purpose of that fund. 5. Unassigned fund balance (residual net resources) This is the excess of total fund balance over non-spendable, restricted, committed, and assigned fund balance. Unassigned amounts are technically available for any purpose. B. Order of Expenditure of Funds When multiple categories of fund balances are available for expenditure (for example, a construction project is funded partly by grant money, funds set aside by the City Commission, and unassigned fund balance) the City will start with the most restricted category first until depleted before moving to the next category with available funds. Spendable fund categories in 12

70 order of most restricted to least restricted are: Restricted, Committed, Assigned, and Unassigned. C. Minimum Unassigned Fund Balance It is the goal of the City to achieve and maintain a minimum unassigned fund balance in the general fund to ensure that there will be adequate liquid resources in the event of unanticipated circumstances and events. The desired unassigned fund balance of 50% is optimal. The minimum unassigned fund balance is set at 25% of budgeted expenditures for the fiscal year, providing for approximately 90 days of estimated expenditures. D. Designated Circumstances the minimum unassigned fund balance may be spent under these circumstances: 1. Natural disasters, including but not limited to tornados, fire or flood. 2. Opportunities for a grant in which the matching portion may require a portion of the minimum unassigned fund balance. 3. Shortfall in the budgeted revenue in excess of 20%. 4. Unforeseeable expenditures in excess of 20% over budget. 5. When unforeseen circumstances or emergencies in another fund require a fund transfer from the General Fund. 6. If the previous year s audit reflects a fund balance of more than 50%, then that excess may be used for projects or capital purchases first approved by the city commission. The expenditures made shall not cause the fund balance to drop below 50%. E. Replenishment of Minimum Unassigned Fund Balance 1. When designated circumstances have reduced the unassigned fund balance below the targeted minimum level, the replenishment is to occur within 12 months. 2. Depending on the severity of the reduction of the minimum unassigned fund balance the following measures will be taken to replenish the minimum unassigned fund balance: a) Should calculations reveal that the minimum unassigned fund balance will be replenished through normal activity within the next 12 months no action is necessary b) Reduction of expenditures c) Delay of capital purchases d) Increase in fees and/or taxes e) Salary freeze f) Hiring freeze 13

71 Appendix A. Authorized Broker/Dealer List At this time, the City solely uses Happy State Bank for all investments. No authorized broker/dealer listed are required at this time. 14

72 INVESTMENT POLICY I. POLICY It is the policy of the City of Canyon (the City ) that after allowing for the anticipated cash flow requirements of the EntityCity and giving due consideration to the safety and risk of investment, all available funds shall be invested in conformance with these legal and administrative guidelines, seeking to optimize interest earnings to the maximum extent possible. Effective cash management is recognized as essential to good fiscal management. Investment interest is a source of revenue to the City of Canyon s funds. The City s investment portfolio shall be designed and managed in a manner designed to maximize this revenue source, to be responsive to public trust, and to be in compliance with legal requirements and limitations. Investments shall be made with the primary objectives of: Safety and preservation of principal Maintenance of sufficient liquidity to meet operating needs Public trust from prudent investment activities Optimization of interest earnings on the portfolio II. PURPOSE The purpose of this investment policy is to comply with Chapter 2256 of the Government Code ( Public Funds Investment Act ), which requires each the EntityCity to adopt a written investment policy regarding the investment of its funds and funds under its control. The Investment Policy addresses the methods, procedures and practices that must be exercised to ensure effective and judicious fiscal management of the City of Canyon s funds. III. SCOPE This Investment Policy shall govern the investment of all financial assets of the City of Canyon. These funds are accounted for in the EntityCity s Comprehensive Annual Financial Report (CAFR) and include: General Fund Water Works & Sewer System Fund Golf Course Fund C.E.D.C. Funds W/S Bond Funds 1

73 Emergency Management Fund Library Gift and Memorial Fund Board of City Development Fund LEOSE Fund D-Fi-It Program Employee Flower Fund Vol. Firemen s Funds All subsidiary funds and Aany new fund created unless specifically exempted The City of Canyon may consolidate cash balances from all funds to maximize manage bank service needs and enhance investment earnings. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles. This Investment Policy shall apply to all transactions involving the financial assets and related activity for all the foregoing funds. IV. INVESTMENT OBJECTIVES The EntityCity shall manage and invest its cash with four primary objectives, listed in order of priority: safety, liquidity, public trust, and yield, expressed as optimization of interest earnings. The safety of the principal invested always remains the primary objective. All investments shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. The EntityCity shall maintain a comprehensive cash management program, which includes collection of account receivables, vendor payments in accordance with invoice terms, and prudent investment of available cash. Cash management is defined as the process of managing monies in order to insure maximum adequate cash availability and maximum optimum earnings on short-term investment of idle cash. Safety [PFIA (b)(2)] Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit and interest rate risk. Credit Risk The City of Canyon will minimize credit risk, the risk of loss due to the failure of the issuer or backer of the investment, by: Limiting investments to the safest types of investments Pre-qualifying the financial institutions and broker/dealers with which the City will do business Diversifying the investment portfolio issuer credit risk, when appropriatepossible, so that potential losses on individual issuers will be minimized. If, in the opinion of the Investment Officer, it is most advantageous to maintain all funds in a single Financial Institution, then 2

74 the City Commission shall have the authority to waive this diversification requirement. Interest Rate Risk the City will minimize the risk that the interest earnings and the market value of investments in the portfolio will fall due to changes in general interest rates, by: Structuring the investment portfolio so that investments mature to meet cash requirements for ongoing operations, thereby avoiding the need to liquidate investments prior to maturity. Investing operating funds primarily in certificates of deposit, shorterterm securities, money market mutual funds, or local government investment pools functioning as money market mutual funds. Diversifying maturities and staggering purchase dates to minimize the impact of market movements over time. Utilizing any other method of investment management allowable by the Public Funds Investment Act deemed most advantageous based on current market conditions. Liquidity [PFIA (b)(2)] The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that investments mature concurrent with cash needs to meet anticipated demands. Public Trust All participants in the City s investment process shall seek to act responsibly as custodians of the public trust. Investment officers shall avoid any transaction that might impair public confidence in the City s ability to govern effectively. Yield (Optimization of Interest Earnings) [PFIA (b)(3)] The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. V. RESPONSIBILITY AND CONTROL Delegation of Authority [PFIA (f)] In accordance with The City of Canyon and the Public Funds Investment Act, tthe City Commission designates the City Manager as the Chief Financial Officer, and he/she and the Director of Finance as the City s Investment Officers. An Investment Officer is authorized to execute investment transactions on behalf of the City. No person may engage in an Commented [RL1]: New Titles? 3

75 investment transaction or the management of City funds except as provided under the terms of this Investment Policy as approved by the City Commission. The investment authority granted to the iinvestmenting oofficers is effective until rescinded by the City Commission. Quality and Capability of Investment Management [PFIA (b)(3)] The City shall provide periodic training in investments for the designated iinvestment oofficers and other investment personnel through courses and seminars offered by professional organizations, associations, and other independent sources in order to insure the quality and capability of investment management in compliance with the Public Funds Investment Act. Training Requirement (PFIA ) In accordance with the City of Canyon and the Public Funds Investment Act, designated Investment Officers shall attend an investment training session no less often than once every two years, aligned with the City s fiscal year end, commencing September 1, 1997 and shall receive accumulate not less than 10 8 hours of instruction relating to investment responsibilities. A newly appointed Investment Officer must attend a training session of accumulating at least 10 hours of instruction within twelve months of the date the officer took office or assumed the officer s duties. Approved training sources include: Government Finance Officers Association Government Finance Officers Association of Texas Government Treasurers Organization of Texas Texas Municipal League University of North Texas The investment training session shall be provided by an independent source approved by the State of Texas and compliant with the requirements of the Public Funds Investment Act. For purposes of this policy, an independent source from which investment training shall be obtained shall include a professional organization, an institution of higher education or any other sponsor other than a business organization with whom the City may engage in an investment transaction. Internal Controls (Best Practice) The Chief Financial Officer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. Commented [RL2]: Title? 4

76 Accordingly, the Chief Financial Officer shall establish a process for annual independent review by an the external auditor to assure compliance with policies and procedures. The internal controls shall address the following points. Control of collusion. Separation of transactions authority from accounting and record keeping. Custodial safekeeping. Clear delegation of authority to subordinate staff members. Written confirmation for telephone (voice) transactions for investments and wire transfers, and Development of a wire transfer agreement with the depository band or third party custodian Prudence (PFIA ) The standard of prudence to be applied by the Investment Officer shall be the prudent investor rule. This rule states that Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. In determining whether an Investment Officer has exercised prudence with respect to an investment decision, the determination shall be made taking into consideration: The investment of all funds, or funds under the City s control, over which the officer had responsibility rather than a consideration as to the prudence of a single investment. Whether the investment decision was consistent with the written approved investment policy of the City. Indemnification (Best Practice) The Investment Officer, acting in accordance with written procedures and exercising due diligence, shall not be held personally responsible for a specific investment s credit risk or market price changes, provided that these deviations are reported immediately and the appropriate action is taken to control adverse developments. Ethics and Conflicts of Interest [PFIA (i)] Investment Officers and employees involved in the investment process shall refrain from personal business activity that would conflict with the proper execution and management of the investment program, or that would impair their ability to make impartial decisions. Employees and Investment Officers shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal 5

77 financial/investment positions that could be related to the performance of the investment portfolio. Employees and Investment oofficers shall refrain from undertaking personal investment transactions with the same individual with which business is conducted on behalf of the City. An Investment Officer of the City who has a personal business relationship with an organization seeking to sell an investment to the City shall file a statement disclosing that personal business interest. An Investment Officer who is related within the second degree by affinity or consanguinity to an individual seeking to sell an investment to the City shall file a statement disclosing that relationship. A statement required under this subsection must be filed with the Texas Ethics Commission and the City Commission. VI. SUITABLE AND AUTHORIZED INVESTMENTS Portfolio Management The EntityCity currently has a buy and hold portfolio strategy. Maturity dates are matched with cash flow requirements and investments are purchased with the intent to be held until maturity. However, investments may be liquidated prior to maturity for the following reasons: An investment with declining credit may be liquidated early to minimize loss of principal. Cash flow needs of the EntityCity require that the investment be liquidated. Investments [PFIA (b)(4)(A)] City funds governed by this ppolicy may be invested in the instruments described below, all of which are authorized by Chapter 2256 of the Government Code (the Public Funds Investment Act). Investment of City funds in any instrument or security not authorized for investment under the Act is prohibited. The City will not be required to liquidate an investment that becomes unauthorized subsequent to its purchase. I. Authorized 1. Obligations, including letters of credit, of the United States of America or, its agencies and instrumentalities, including the Federal Home Loan Banks. 2. Certificates of Deposit, and other forms of deposit, issued byplaced with a bank or other approved financial institution organized under Texas law, the laws of another state, or federal law, that has its main office or a branch office in Texas, organized under Texas law, the laws of another state, or federal law, that has its 6

78 main office or a branch office in Texas and that is guaranteed or insured by the Federal Deposit Insurance Corporation or its successor, or secured by obligations in a manner and amount provided by law for deposits of the EntityCity. 3. Money Market Mutual ffunds that are 1) registered and regulated by the Securities and Exchange Commission, 2) have a dollar weighted average stated maturity of 90 days or lessmanaged in compliance with money market fund regulations, 3) rated AAA by at least one nationally recognized rating service, and 4) seek to maintain a stable net asset value of $ per share. 4. Local government investment pools, which 1) meet the requirements of Chapter of the Public Funds Investment Act, 2) are rated no lower than AAA or an equivalent rating by at least one nationally recognized rating service, 3) seek to maintain a $1.00 net asset value, and 4) are authorized by resolution or ordinance by the City Commission. 5. Certificates of Deposit and Money Market Accounts through cooperative programs such as CDARS (Certificates of Deposit Account Registry Service) and ICS (Insured Cash Sweep) which spread deposits to provides $250,000 FDIC Insurance Coverage per Financial Institution and insure the total deposit. 6. Other securities as permitted by Public Funds Investment Act Sec Obligations of states, agencies, counties, cities, and other political subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less than A or its equivalent. 7. Any other investment allowable under the Public Funds Investment Act meeting the goals of this policy that results in a maximization of yield, based on market conditions. It is the policy of the City to provide a competitive environment for all individual investment purchases and sales, and financial institution, money market mutual fund, and local government investment pool selections. All security transactions shall be executed using the delivery versus payment method. That is, funds shall not be wired or paid until verification has made that the correct security was received by the City s safekeeping agent. The City shall contract with a bank or banks for the safekeeping of securities owned by the City as part of its investment portfolio. Securities owned by the City shall be held in the City s account as evidenced by safekeeping receipts of the institution holding the securities. Safekeeping institutions shall be independent from the parties involved in the investment transaction. All prudent measures will be taken to liquidate an investment that is downgraded to less than the required minimum rating. (PFIA ) 7

79 II. Not Authorized [PFIA (b)(1-4)] Investments including interest-only or principal-only strips of obligations with underlying mortgage-backed security collateral, and collateralized mortgage obligations with an inverse floating interest rate or a maturity date of over 10 years are strictly prohibited. VII. INVESTMENT PARAMETERS Maximum Maturities [PFIA (b)(4)(B)] The longer the maturity of investments, the greater their price volatility. Therefore, it is the City s policy to concentrate its investment portfolio in shorter-term securities investments in order to limit principal risk caused by changes in interest rates. The City attempts to match its investments with anticipated cash flow requirements. The City will not directly invest in securities investments maturing more than two three (32) years from the date of purchase; however, the above described obligations, certificates, or agreements may be collateralized using longer dated investments. Diversification [PFIA (b)(3)] The City recognizes that investment risks can result from issuer defaults, market price changes or various technical complications leading to temporary illiquidity. Risk is controlled through portfolio diversification that shall be achieved by the following general guidelines: Limiting investments to avoid overconcentration in investments from a specific issuer or business sector (excluding those deposit that are fully insured and collateralized in accordance with state and federal law), Limiting Restricting/prohibitinginvestment in investments that have higher credit risks (example: commercial paper), Investing in investments with varying maturities, and Continuously investing a portion of the portfolio in readily available fundscash equivalent options such as local government investment pools (LGIPs), money market funds, or interest bearing demand or money market depository accounts, or overnight repurchase agreements to ensure that appropriate liquidity is maintained in order to meet ongoing obligations. The following maximum limits, by instrument, are established for the Entity s total portfolio: 1. U.S. Treasury Securities % 2. Agencies and Instrumentalities... 85% 3. Certificates of Deposit % 8

80 4. Money Market Mutual Funds... 50% 5. Authorized Pools... 50% 6. Interest-Bearing Depository Accounts. 100% Investment Policy Certification All local government investment pools and discretionary investment management firms must sign a certification acknowledging that the organization has received and reviewed the City s Investment Policy, and that reasonable procedures and controls have been implemented to preclude investment transactions that are not authorized by the City s Policy in accordance with the PFIA. Authorized Broker/Dealers Formatted: Indent: Left: 0.5", No bullets or numbering Formatted: Font: 10 pt Formatted: Font: 12 pt Formatted: Font: 12 pt, Not Italic Formatted: Font: 12 pt Formatted: Font: Not Italic The City shall, at least annually, review, revise, and adopt a list of qualified broker/dealers authorized to engage in securities transactions with the City. Authorized firms include primary dealers or secondary dealers that qualify under Securities & Exchange Commission Rule 15C3-1 (Uniform Net Capital Rule). The Authorized Broker/Dealer list is attached in Appendix A. Depositories The City will select and designate a qualified primary bank depository in compliance with State law and the City s purchasing policy. Additionally the City may utilize other depository institutions to expand deposit placement opportunities or provide specialty services. Formatted: Font: Not Italic Formatted: Font: Not Italic All depository balances shall be insured or collateralized in compliance with applicable State law. The City reserves the right, in its sole discretion, to accept or reject any form of insurance or collateralization pledged towards depository deposits. Depositories will be required to sign an Agreement with the City. The Agreement shall address any concerns in relation to acceptable collateral, levels of collateral, substitution and addition of collateral, and reporting and monitoring of collateral. The collateralized deposit portion of the Agreement shall define the City s rights to the collateral in case of default, bankruptcy, or closing, and shall establish a perfected security interest in compliance with Federal and State regulations, including: The Agreement must be in writing; The Agreement has to be executed by the Depository and the City contemporaneously with the acquisition of the asset; The Agreement must be approved by the Board of Directors or Designated Committee of the Depository and a copy of the meeting minutes must be delivered to the City; and The Agreement must be part of the Depository s official record continuously since its execution. Formatted: Bulleted + Level: 1 + Aligned at: 0.25" + Indent at: 0.5" 9

81 Collateral will be held by a third party custodian designated by the City and pledged to the City as evidenced by pledge receipts of the institution with which the collateral is deposited. Original pledge receipts shall be obtained. Collateral may be held by a Federal Reserve Bank or branch of a Federal Reserve Bank, a Federal Home Loan Bank, or a third party bank approved by the City and eligible under State law. VIII. REPORTING (PFIA ) Formatted: Font: 12 pt Methods The Investment Officers shall prepare an investment report on a quarterly basis that summarizes investment strategies employed in the most recent quarter and describes the portfolio in terms of investment securities and maturities, and shall explain the total investment return for the quarter. The quarterly investment report shall include a summary statement of investment activity prepared in compliance with generally accepted accounting principals. This summary will be prepared in a manner that will allow the EntityCity to ascertain whether investment activities during the reporting period have conformed to the Investment Policy. The report will be provided to the City Commission. The report will include the following: A listing of individual securities investments held at the end of the reporting period. Unrealized gains or losses resulting from appreciation or depreciation by listing the beginning and ending book and market value of securities investments for the period. Additions and changes to the market value during the period. Average weighted yield to maturity of portfolio as compared to applicable benchmark. Listing of investments by maturity date. Fully accrued interest for the reporting period. The percentage of the total portfolio that each type of investment represents. Statement of compliance of the EntityCity s investment portfolio with state law and the investment strategy and policy approved by the City Commission. Signatures of each Investment Officer. The market value of the portfolio will be calculated, and investment credit ratings will be confirmed on a quarterly basis in compliance with the reporting requirements. In determining market value and credit ratings, sources independent of the investment provider will be pursued. Weighted average yield to maturity shall be the standard on which investment performance is calculated. As a function of the annual audit, the quarterly investment reports shall be reviewed by the external auditor and the results of that review provided to the City Commission. 10

82 IX. INVESTMENT STRATEGIES Operating Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for Operating Funds. Commented [RL3]: These are some common ones. The City may have different fund-types. Formatted: Font: Not Italic Safety of Principal - All investments shall be of high quality with no perceived default risk. Market price fluctuations may occur. However, by managing the weighted average days to maturity for the Operating Fund s portfolio to less than 270 days and restricting the maximum allowable maturity to two years, the price volatility of the overall portfolio will be minimized. Marketability - Securities with active and efficient secondary markets are necessary in the event of an unanticipated cash flow requirement. Liquidity - The Operating Funds requires the greatest short-term liquidity of any of the Fund types. Cash equivalent investments will provide daily liquidity and may be utilized as a competitive yield alternative to fixed maturity investments. Diversification - Investment maturities should be staggered throughout the budget cycle to provide cash flow based on the anticipated operating needs of the City. Market cycle risk will be reduced by diversifying the appropriate maturity structure out through two years. Yield - Attaining a competitive market yield for comparable investment-types and portfolio restrictions is the desired objective. The yield of an equally weighted, rolling three-month Treasury Bill portfolio will be the minimum yield objective. Construction and Capital Improvement Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for Construction and Capital Improvement Funds. Formatted: Font: Not Italic Formatted: Font: Not Italic, Underline Safety of Principal All investments will be of high quality with no perceived default risk. Market fluctuations may occur. However, by restricting the maximum maturity to the lesser of the anticipated cash flow requirements, three years or the IRS defined temporary period, the market risk of the portfolio will be minimized. Marketability - The balancing of short-term and long-term cash flow needs requires the Construction and Capital Improvement Funds portfolio to have securities with active and efficient secondary markets. Liquidity - Construction and Capital Improvement Funds used as part of a CIP plan or scheduled repair and replacement program are reasonably predictable. However, unanticipated needs or emergencies may arise. Maintaining minimum cash equivalent investment amounts will reduce the liquidity risk of unanticipated expenditures. 11

83 Diversification - Investment maturities should blend the short-term and long-term cash flow needs to provide adequate liquidity, yield enhancement and stability. A barbell maturity ladder may be appropriate. Yield - Attaining a competitive market yield for comparable investment-types and portfolio structures is the desired objective. The yield of an equally weighted, rolling six-month Treasury Bill portfolio will be the minimum yield objective. Debt Service Funds Strategy Suitability - Any investment eligible in the Investment Policy is suitable for the Debt Service Fund. Formatted: Font: Not Italic Safety of Principal - All investments shall be of high quality with no perceived default risk. Market price fluctuations may occur. However, by managing Debt Service Funds to not exceed the debt service payment schedule, the market risk of the overall portfolio will be minimized. Marketability - Securities with active and efficient secondary markets are not necessary as the event of an unanticipated cash flow requirement is not probable. Liquidity - Debt Service Funds have predictable payment schedules. Therefore, investment maturities should not exceed the anticipated cash flow requirements. Cash equivalent investments may provide a competitive yield alternative for short term fixed maturity investments. Diversification - Market conditions influence the attractiveness of fully extending maturity to the next unfunded payment date. Generally, if investment rates are anticipated to decrease over time, the City is best served by locking in most investments. If the interest rates are potentially rising, then investing in shorter and larger amounts may provide advantage. At no time shall the debt service schedule be exceeded in an attempt to bolster yield. Yield - Attaining a competitive market yield for comparable investment-types and portfolio restrictions is the desired objective. The yield of an equally weighted, rolling three-month Treasury Bill portfolio shall be the minimum yield objective. IX. INVESTMENT POLICY ADOPTION [PFIA (e)] The EntityCity s investment policy shall be adopted by resolution of the City Commission. It is the EntityCity s intent to comply with state laws and regulations. The EntityCity s investment policy shall be subject to revisions consistent with changing laws, regulations, and needs of the EntityCity. The City Commission of Canyon shall adopt a resolution stating that it has reviewed the policy and investment strategies annually, approving any changes or modifications. 12

84 XI. FUND BALANCE X. A. Definitions - In compliance with the Government Accounting Standard Board (GASB) Statement No. 54, the City has adopted the following definitions: 1. Non-spendable fund balance (inherently not spendable) Includes amounts that will never convert to cash or will not convert to cash in the current period, such as inventory, supplies, long-term portion of loans and non-financial assets held for resale or principal of an endowment. 2. Restricted fund balance (externally enforceable limitations on use) Includes amounts that can be spent only for the specific purposes stipulated by external resource providers either constitutionally or through enabling legislation. Examples include grants, court receipt restrictions (municipal technology fund) or charter restrictions. 3. Committed fund balance (self-imposed limitations) Includes amounts that can be used for the specific purposes determined by a formal action of the City Commission in form of a resolution. Commitments may be changed or lifted only by taking the same formal action that imposed the constraints originally. 4. Assigned fund balance (limitation resulting from management s intended use) Comprises amounts intended to be used for a specific purpose, as expressed by City Commission, by a designated official or committee. By adopting this policy the City Commission has hereby authorized the City Manager as the official to assign fund balance to a specific purpose. In governmental funds other than the general fund, assigned fund balance represents the amount that is not restricted or committed, as it is intended to be used for the purpose of that fund. 5. Unassigned fund balance (residual net resources) This is the excess of total fund balance over non-spendable, restricted, committed, and assigned fund balance. Unassigned amounts are technically available for any purpose. B. Order of Expenditure of Funds When multiple categories of fund balances are available for expenditure (for example, a construction project is funded partly by grant money, funds set aside by the City Commission, and unassigned fund balance) the City will start with the most restricted category first until depleted before moving to the next category with available funds. Spendable fund categories in order of most restricted to least restricted are: Restricted, Committed, Assigned, and Unassigned. C. Minimum Unassigned Fund Balance It is the goal of the City of Canyon to achieve and maintain a minimum unassigned fund balance in the general fund to ensure that there will be adequate liquid resources in the event of unanticipated circumstances and events. The desired unassigned fund balance of 50% is optimal. The minimum unassigned fund balance is set at 25% of budgeted expenditures for the fiscal year, providing for approximately 90 days of estimated expenditures. Formatted: Indent: Left: 0.25", No bullets or numbering Formatted: Font: 14 pt Formatted: Left, Indent: Left: 0.25", No bullets or numbering 13

85 D. Designated Circumstances the minimum unassigned fund balance may be spent under these circumstances: 1. Natural disasters, including but not limited to tornados, fire or flood. 2. Opportunities for a grant in which the matching portion may require a portion of the minimum unassigned fund balance. 3. Shortfall in the budgeted revenue in excess of 20%. 4. Unforeseeable expenditures in excess of 20% over budget. 5. When unforeseen circumstances or emergencies in another fund require a fund transfer from the ggeneral ffund. 6. If the previous year s audit reflects a fund balance of more than 50%, then that excess may be used for projects or capital purchases first approved by the city commission. The expenditures made shall not cause the fund balance to drop below 50%. E. Replenishment of Minimum Unassigned Fund Balance 1. When designated circumstances have reduced the unassigned fund balance below the targeted minimum level, the replenishment is to occur within 12 months. 2. Depending on the severity of the reduction of the minimum unassigned fund balance the following measures will be taken to replenish the minimum unassigned fund balance: a) Should calculations reveal that the minimum unassigned fund balance will be replenished through normal activity within the next 12 months no action is necessary b) Reduction of expenditures c) Delay of capital purchases d) Increase in fees and/or taxes e) Salary freeze f) Hiring freeze Formatted: Centered 14

86 Appendix A. Authorized Broker/Dealer List FTN Financial (Zach Brewer, Houston, TX) Raymond James (Polly Moore, Austin, TX) Wells Fargo Securities (Chuck Landry, Dallas, TX) Note: Approval is by firm. Representative and office are provided for information purposes only and subject to change. 15

87 REGARDING ITEM 10 AGENDA TO: FROM: Randy Criswell, City Manager Chris Sharp, Assistant City Manager DATE: January 18, 2018 SUBJECT: Consider and Take Appropriate Action on Quarterly Finance Report by Finance Director Chris Sharp. A summary of all deposits for the City of Canyon as of December 31, 2017 are submitted. All funds are deposited with the City s depository bank, Happy State Bank. Also included, is a summary of the City s major funds and where they stand as of the same date. Total deposits needing security pledge, including checking accounts are $_4,790,904. Total securities pledged by Happy State Bank including the FDIC insurance is $_6,970,350. This report is to comply with legislation requiring periodic reports to be made to the governing body for approval. RECOMMENDED ACTION Approval of the Quarterly Finance Report for the Quarter Ending December 31, City of Canyon

88 City of Canyon QUARTERLY FINANCE REPORT Quarter ending: 09/30/ /31/2017 Interest Rate EMERGENCY MANAGEMENT 0.50 $ 35, $ 35, LIBRARY GIFT & MEMORIAL 0.50 $ 5, $ 3, GENERAL FUND DEMAND ACCT 0.50 $ 490, $ 1,367, WW/SS FUND DEMAND ACCT $ 1,321, $ 1,761, BCD 0.50 $ 130, $ 140, LEOSE 0.50 $ 8, $ 7, C.E.D.C (ECONOMIC DEVELOPMENT 0.50 $ 338, $ 384, C.E.D.C. MARKETING ACCOUNT 0.50 $ 112, $ 131, EMPLOYEES FLOWER FUND 0.50 $ 2, $ D-FI-IT PROGRAM 0.50 $ $ Palo Duro Golf Administration 0.50 $ 333, $ 587, Capital Equipment Account 0.50 $ 400, $ 369, CHECKING / SAVINGS ACCOUNTS BALANCES $ 3,180, $ 4,790, TOTAL FUNDS FOR SECURITY PLEDGES $ 3,180, $ 4,790, WW/SS Utility Insured Cash Sweep Account (CDARS) Interest 0.91 $ 3,548, $ 2,557, TOTAL AMOUNT OF FUNDS IN BANK $ 6,728, $ 7,348, SECURITIES PLEDGED HAPPY STATE BANK RECEIPT DATE DESC. AMOUNT MARKET NUMBER MATURED VALUE 3137ASNJ9 03/25/2022 FHMS $1,609, $1,615, QN6 08/15/2027 China Spring ISD $1,058, $1,026, ER9 08/15/1930 Lytle TX ISD $569, $592, YM9 02/15/1932 Northwest TX ISD $1,059, $1,112, L7 07/01/1931 TX A&M UNV Fund $1,222, $1,265, FB87 05/25/1933 FNR $1,432, $1,108, FDIC INSURANCE $100, $250, Total Security Pledges $7,052, $6,970, Total Outstanding debt from 2012 issued CO's and 2013 refunded CO's $ 10,955,000 Total Outstanding debt from 2016 General Obligation Bonds $ 5,355,000

89 Summary of Month Ending Dec 2017 Major Revenues 12/31/2017 Budgeted Amount Percentage to Budget 25% General Fund Sales Tax $ 339, $ 2,300, % Franchise Taxes $ 201, $ 790, % Mixed Beverage Tax $ 4, $ 16, % Municipal Court Fines $ 52, $ 275, % Other Income $ 37, $ 40, % Fire Service Randall County $ 72, $ 290, % Randall County, Library Funding $ 12, $ 50, % Commercial Solid Waste $ 90, $ 380, % Residential Solid Waste $ 341, $ 1,365, % Ad Valorem Taxes $ 34, $ 2,740, % Summary of Revenues General Fund Summary of Revenues General Fund Sales Tax Sales Tax Franchise Taxes Franchise Taxes Mixed Beverage Tax Mixed Beverage Tax Municipal Court Fines Municipal Court Fines Other Income Other Income Fire Service Randall County Fire Service Randall County Randall County, Library Funding Randall Commercial County, Library Solid Waste Funding Commercial Residential Solid Solid Waste Waste Residential Ad Valorem Solid Waste Taxes Ad Valorem Taxes Total General Fund Revenues $ 1,293, $ 10,179, % Total General Fund Expenses $ 2,418, $ 10,179, % Utility Fund Water Receipts $ 1,206, $ 4,472, % Waste Water Receipts $ 733, $ 2,716, % Lease Income $ - $ 26, % Penalties $ 17, $ 80, % T-on & Reconnection Revenue $ 7, $ 24, % Water Taps $ 17, $ 30, % Total Utility Fund Revenues $ 2,043, $ 7,412, % Total Utility Fund Expenses $ 1,307, $ 7,412, % Historical Summary of Sales Tax JAN $ 262, $ 208, $ 214, $ 184, FEB $ 270, $ 261, $ 217, $ 242, MAR $ 182, $ 247, $ 177, $ 182, APR $ 201, $ 182, $ 226, $ 169, MAY $ 312, $ 253, $ 249, $ 215, JUN $ 190, $ 188, $ 193, $ 173, JUL $ 207, $ 205, $ 187, $ 164, AUG $ 245, $ 235, $ 247, $ 204, SEP $ 219, $ 204, $ 202, $ 185, OCT $ 231, $ 227, $ 239, $ 223, NOV $ 294, $ 258, $ 256, $ 216, DEC $ 220, $ 216, $ 266, $ 185, $ 2,840, $ 2,690, $2,679, $ 2,347, Palo Duro Creek Golf Course Budgeted Amount Percentage to Budget Revenues to Date $117, $1,425, % Exenditures to Date $444, $1,425, % Summary of Revenues Utility Fund Water Receipts Summary of Revenues Utility Fund Waste Water Receipts Lease Income Penalties T on & Reconnection Revenue Water Receipts Water Taps Waste Water Receipts Lease Income Penalties T on & Reconnection Revenue Water Taps

90 CITY OF CANYON SALES TAX COLLECTION HISTORY FISCAL YEAR % INCREASE/ % INCREASE/ TOTAL DECREASE DECREASE YEAR-TO-DATE YEAR-TO-DATE MONTH COLLECTIONS COLLECTIONS OVER COLLECTIONS OVER COLLECTIONS TAXABLE SALES ** OCTOBER $223,456 $239, % $227, % $227,753 $15,183,533 NOVEMBER $216,081 $256, % $258, % $485,769 $32,384,600 DECEMBER $185,766 $266, % $216, % $702,659 $46,843,933 JANUARY $214,709 $208, % $262, % $964,669 $64,311,267 FEBRUARY $217,411 $261, % $270, % $1,235,533 $82,368,867 MARCH $177,351 $247, % $182, % $1,418,442 $94,562,800 APRIL $226,391 $182, % $201, % $1,620,297 $108,019,800 MAY $249,330 $253, % $312, % $1,933,150 $128,876,667 JUNE $193,998 $188, % $190, % $2,123,555 $141,570,333 JULY $187,474 $205, % $207, % $2,331,076 $155,405,067 AUGUST $247,697 $235, % $245, % $2,576,119 $171,741,267 SEPTEMBER $202,362 $204, % $219, % $2,795,803 $186,386,867 TOTALS $2,542,026 $2,750,440 $2,795,803

91 REGARDING ITEM 11 AGENDA TO: FROM: Randy Criswell, City Manager Chris Sharp, Assistant City Manager DATE: January 18, 2018 SUBJECT: Consider and Take Appropriate Action on Quarterly Investment Report by Finance Director Chris Sharp. A summary of all investments for the City of Canyon as of December 31, 2017 are submitted as an attachment to this agenda item. All funds are invested with the City s depository bank, Happy State Bank. Total amount of investments for the City is $2,431,206. These funds have been invested in the CDARS program and in CDs through Happy State Bank. The Canyon EDC also has investments in the CDARS program in the amount of $175,506. The City s 2012 certificates of obligation funds have been invested into a CDARS investment account and has a balance of $3,259,883. Total funds on hand, which includes funds in depository accounts as well as funds in investments total $9,779,955. This report is to comply with legislation requiring periodic reports to be made to the governing body for approval. RECOMMENDED ACTION Approval of the Quarterly Investment Report for the Quarter Ending December 31, City of Canyon

92 QUARTERLY INVESTMENT REPORT Quarter ending: 09/30/ /31/2017 Interest Rate Interest earned CERTIFICATE OF DEPOSITS: for quarter CD# Interest Rate 6611 CEDC CD $ 57, $ 57, $ CEDC CD $ 58, $ 58, $ CEDC CD $ 58, $ 58, $ CDARS CERTIFICATES OF DEPOSIT $ 175, $ 175, GENERAL FUND CD 1.10% $ 250, $ 250, $ GENERAL FUND CD 1.10% $ 149, $ 149, $ GENERAL FUND CD 1.10% $ 508, $ 509, $ GENERAL FUND CD 1.10% $ 149, $ 149, $ GENERAL FUND CD 1.10% $ 151, $ 151, $ GENERAL FUND CD 1.10% $ 617, $ 619, $ 1, WW/SS FUND CD 1.10% $ 599, $ 600, $ TOTAL AMOUNT IN CDARS $2,427, $ 2,431, TOTAL AMOUNT OF FUNDS IN BANK $6,955, $ 7,348, TOTAL FUNDS ON HAND $9,383, $ 9,779, Certificates of Obligations (Invested in CDARS account) 1.31% $ 3,974, $ 3,259, $ 10,527.86

93 REGARDING ITEM 12 AGENDA To: From: Randy Criswell, City Manager Chris Sharp, Assistant City Manager Date: January 15, 2018 Re: Consider and Take Appropriate Action on Agreement for Alternative Payment Method with Potter-Randall Appraisal District. For several years now, the City has been paying Potter-Randall Appraisal District (PRAD) one time a year for appraisal services instead of the optional four times a year. This was changed to one time a year because it was easier and cost less for the City to pay once a year instead of four times a year. At this time, we feel that it is more efficient to continue paying one time a year. After speaking with Jeffrey Dagley, Chief Appraiser, it was decided that an agreement needs to be entered into between the City and PRAD for the once a year payment. Attached to this agenda is the agreement for a once a year payment. It is staff s recommendation that the Commission approve the agreement between the City and Potter-Randall Appraisal District for a one time a year payment for appraisal services. City of Canyon

94 Potter-Randall Appraisal District 5701 HOLLYWOOD ROAD (LOOP 335) PO BOX 7190 AMARILLO, TX PHONE (806) FAX (806) Visit our web info@prad.org Jeffrey Dagley, Chief Appraiser Board of Directors - Potter Board of Directors - Randall Zachary Plummer Chairman Dennis Beene Chairman Gilbert Guzman Jr. Vice Chairman Henry Hamilton Secretary Cindy Spanel Secretary Kerry Adair Director Leon Church Director James Barrington Director Kay Ledbetter Director Doug Srader Director Sherri Aylor Director Christina McMurray Director Mayor Gary Hinders City of Canyon th St. Canyon, Texas January 15, 2018 Re: Agreement for Alternate Payment Method Dear Mayor Hinders: For many years the allocation from your entity towards the Potter-Randall Appraisal District budget has been made in full before January 1 of the year in which the budget takes effect instead of in four equal payments. According to Texas Property Tax Code Section 6.06(e) as stated below, the governing body of a unit and the chief appraiser may agree to method of payment that differs from the four equal payments stated in the code. (e) Unless the governing body of a unit and the chief appraiser agree to a different method of payment, each taxing unit shall pay its allocation in four equal payments to be made at the end of each calendar quarter, and the first payment shall be made before January 1 of the year in which the budget takes effect. A payment is delinquent if not paid on the date it is due. A delinquent payment incurs a penalty of 5 percent of the amount of the payment and accrues interest at an annual rate of 10 percent. If the budget is amended, any change in the amount of a unit s allocation is apportioned among the payments remaining. While there was likely an agreement in place with the previous administrations of both of our organizations, we have not been able to locate the agreement and feel that it is necessary to have a written agreement in place to specify this alternate payment method and to comply with the property tax code. I have included the proposed agreement that would continue the current payment method. We will still will provide an invoice for the full amount as we have for many years. The agreement also states the method of determining the calculation for the penalty and interest will be based on the full allocation payment that will be due before January 1 of the year in which the budget takes effect.

95 Please review the included agreement. If your governing body agrees to the terms set forth, please have the governing body approve the agreement and return it to me at your earliest convenience. If you have any questions please contact me at or Sincerely, Jeffrey Dagley, RPA Chief Appraiser Enclosure

96 AGREEMENT FOR ALTERNATE PAYMENT METHOD FOR APPRAISAL DISTRICT BUDGET STATE OF TEXAS COUNTY OF RANDALL THIS AGREEMENT, made and entered into by and between the Potter- Randall Appraisal District Chief Appraiser, as appointed by the District s board of directors, operating pursuant to the provisions of the Texas Property Tax Code, acting by and through its governing bodies, the Boards of Directors, (hereinafter referred to as Appraisal District ), and the governing body of the City of Canyon, (hereinafter referred to as Canyon ), WHEREAS the Texas Property Tax Code states in Appraisal District Budget and Financing subsections (e) and (K): (e) Unless the governing body of a unit and the chief appraiser agree to a different method of payment, each taxing unit shall pay its allocation in four equal payments to be made at the end of each calendar quarter, and the first payment shall be made before January 1 of the year in which the budget takes effect. A payment is delinquent if not paid on the date it is due. A delinquent payment incurs a penalty of 5 percent of the amount of the payment and accrues interest at an annual rate of 10 percent. If the budget is amended, any change in the amount of a unit s allocation is apportioned among the payments remaining. (k) For good cause shown, the board of directors may waive the penalty and interest on a delinquent payment under Subsection (e). Canyon agrees to: A. To submit the full allocation payment before January 1 of the year in which the budget takes effect in lieu of submitting four equal payments as allowed by agreement between the Chief Appraiser and the unit s governing board as specified by the Texas Property Tax Code 6.06(e). B. Pay penalty and interest on a delinquent payment in the amounts specified by the Texas Property Tax Code Section 6.06(e) for the full allocation that is due before January unless waived by the Appraisal District Board of Directors pursuant to Texas Property Tax Code 6.06(k). Appraisal District Chief Appraiser agrees to: A. Provide Canyon an invoice for the full allocation amount. B. Assess penalty and interest on a delinquent payment in the amounts specified by the Texas Property Tax Code Section 6.06(e) for the full allocation that is due before January unless waived by the Appraisal District Board of Directors pursuant to Texas Property Tax Code 6.06(k).

97 Both parties may at any time terminate this agreement by written notice to the other party. If this agreement is terminated Canyon will be required to comply with the four equal payments as specified by the Texas Property Tax Code 6.06(e). IN WITNESS WHEROF, the parties to this agreement have hereunto set their hands this day of, Potter-Randall Appraisal District Chief Appraiser, Jeffrey Dagley City of Canyon

98 REGARDING ITEM 13 AGENDA To: From: Randy Criswell, City Manager Danny Cornelius, Director of Code Enforcement Date: January 15, 2018 Re: Consider and Take Appropriate Action on a Livestock Permit Renewal Request by Alberta Evans at 510 US Highway 60. Alberta Evans has submitted a request to renew her livestock permit at 510 US Highway 60. According to the request, the maximum number of boarding livestock (horses and donkeys) would be 4 animals. The permit was last renewed at the December 21, 2015 meeting. The minutes of the meeting are attached. According to Section of the Code of Ordinances, any person desiring to keep livestock in the city shall make an application to the City Commission. The permit, if granted, would expire annually on December 31 and must be renewed in the same manner as the original application. The City Commission has the right to revoke any livestock permit if it finds the premises to be a public nuisance. You ll notice the permit wasn t renewed in December 2016 or That s my fault. I dropped the reminder off my calendar and didn t remind her to apply. Five notices were sent to property owners within 200 feet. We received no responses. The letter of application from Alberta Evans is attached. An itemized list of buildings within 500 feet of the property is required by the ordinance. The list is attached. City of Canyon

99 I am writing in regards to the extension of my livestock variance which is up for renewal/approval again. This will allow me to continue to keep my 4 animals on property located at 510 Hwy 60 Canyon, Tx Nearby building include Economy Storage on the west side of me, a small privately owned park type property consisting of an area surrounded by chain link fence. On the East side of me is a privately owned piece of undeveloped property surrounded by chain link fence and on the North side of me is Hwy 60. There are only 2 residential buildings possibly within 500 feet of the property. I respectfully request that we be allowed to continue to have our 3 horses and 1 donkey, for a total of 4 equine, remain at our home where they have resided since I moved into it in They have lived most of their lives right here. We try to make sure that there are no real issues with keeping them at home and have consistently followed any requirements and/or directives issued by the city, to enable us to continue to do so. We did, however, have an issue this past month where our donkey got out. The first time he got out, the city officer who helped me, also walked the fence line with me looking for an opening. Neither of us found one. We did fine one small spot where we thought perhaps he could have squeezed through, so we dropped a T-post into the ground to block it. The fence around the back portion of the property was older and had initially been done incorrectly with the wire on the outside of the posts. The only way I could fix an opening was if I could find it, so I had to wait until he did it again. I was running errands a few days later, with no escapes in the meantime, so I thought it was fixed. I received a call telling me that Chewy, my donkey, was out again. I was home within minutes and immediately put him up. He was not difficult to get back in. In fact, he was at the front of the property and did not wander off. I put him up and again walked the fence, not finding where he could have gotten out. For the next few days I watched him closely and then saw how he did it. I simply couldn t do anything about it until I could see this. It was literally minutes that had passed by the time the phone rang saying someone called about him and I answered the phone letting the person know that I already had him in the yard and that I found where the problem was. As the fence posts were older one had been broken. The fence attached to it had come loose. So when Chewy pushed against it from the inside of the yard he could literally walk through the piece of fence pulling off and get out. However, it would swing closed behind him thus not allowing him to get back into the yard. Because of this he would go around to the front gate. I repaired it at that time. I talked to my husband who is stationed in Afghanistan. He was due to come home soon on leave and thanks to some scheduling changes he was able to come home right after that. We then spent about a week and upwards of about fifteen hundred dollars to tear out the old fence all together and put in an entirely new fence all the way across the entire backside of the property. It has all new posts, strong cattle panel, and includes a hot wire strung on the top to ensure that there is no way for any of them to get out again. We even checked the front fence and redid a weaker section there as well just in case. Thank you very much for your consideration in this matter, and I hope that you see fit to continue to allow us to keep our animals where they are safe and well cared for at our home. Sincerely, Alberta Evans

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107 List of Buildings within 500 of the Permit Request 5 Deer Crossing - House 7 Deer Crossing - House 9 Deer Crossing - House 11 Deer Crossing - House 13 Deer Crossing - House 15 Deer Crossing - House 17 Deer Crossing - House 400 Hwy 60 - Inland Fisheries 2 buildings warehouse and office 406 Hwy 60 - Paul Blake Construction commercial building 500 Hwy 60 - Economy Storage office and 3 storage unit buildings st Ave - House st Ave - House, storage building and carport st Ave - Empty House used as storage, storage building and an office st Ave - Lanky Pitman commercial storage containers and carports st Ave - Storage building st Ave - Storage building 608 N 2 nd Ave - House and 2 storage buildings 100 N 5 th St - Empty House used as storage

108 City Commission Meeting December 20,2010 The City Commission of the City of Canyon met in regular session at 5:30 p.m. in the City Commission Chambers of the Civic Complex. Mayor Quinn Alexander presided over the meeting with the following Commissioners in attendance: Mayor Pro-Tem Jed Welch, Jon Behrens, Gary Hinders and David Logan. Also present were the following City Staff: City Manager Randy Criswell, Assistant City Manager Chris Sharp, Director of Code Enforcement Danny Cornelius, and City Attorney Chuck Hester. Item 1. Call to Order. Mayor Alexander called the meeting to order at 5:33 p.m. Item 2. lnvocation. Commissioner Hinders gave the invocation. Item 3. Approval of the Minutes of the Meetinq of December Commissioner Behrens moved, duly seconded by Commissioner Logan, to approve the minutes of December 6, Motion carried unanimously. Item 4. Public Forum - No public comment was made. Item 5. Comments from lnterested Citizens. Gonsider and Take Appropriate. Action on Request bv Alberta Hockett of Xtreme Groomino at 51Q Hiohwav 60 for a Livestock Permit. Code Enforcement Director Danny Cornelius presented a request for a livestock permit to board horses and donkeys from Alberta Hockett of Xtreme Grooming at 510 US Highway 60. Mr. Cornelius stated currently Xtreme Grooming is boarding 3 donkeys (2 miniature and 1 ful! size) and a horse and the permit application resulted from complaints received by Animal Control. Mr. Cornelius said if the permit is granted, Xtreme Grooming would be allowed to board 4 to 8 animals and would have to inform the City Commission of how many animals were being boarded. Mr. Cornelius said 5 notices were sent out to property owners within 200 feet, with two responses received that were both opposed to the request. Ms. Hockett addressed the Commission stating she had no plans to board anything other than horses and donkeys and answered questions. After discussion, Commissioner Hinders moved, duly seconded by Mayor Pro-Tem Welch, to approve the permit for 6 months and for only 4 animals. Motion carried 4-1 with Commissioner Logan opposed. Item 6. Consider and Take Appropriate Action on Resolution No Denyinq the Rate lncrease Proposed bv Southwestern Public Service Comoany. Filed on Mav 17,2O1O

109 City Gommission Meeting June 20,2011 Page 2 of 4 RESOLUTION NO Item 6. A RESOLUTION OF THE CITY COTMISSION OF THE CITY OF CANYON APPROVING PROJECT FUNDING AGREEilIENT BETWEEN BDC PROPERTIES'CONSTRUCTION AND CANYON EGONOTUIIC DEVELOPiNENT CORPORATION REGARDING THE PROPERTY LOCATED AT lio N. 23RD STREET, CANYON, RANDALL COUNTY, TEXAS. First Readinq of Resolution No A Resolution of the Citv Commission of the Citv of Canvon Approvinq Proiect Fundinq Aoreement Between Rustic Gvpsv and Canvon Economic Development Corporation. Business and Community Development Director Evelyn Ecker presented Resolution for its first reading. Ms. Ecker stated the owner of Rustic Gypsy, Meagan Brown, has requested lease subsidy for 2 years with the first year reimbursement being 50% and the second year 35% for a total of $12,138 paid in arrears, and marketing assistance in the amount of $2,500 to be used for direct marketing and advertising. Ms. Ecker stated Ms. Brown has been in business painting furniture and faux finishing walls for 10 years and is adding a retail storefront that wil! offer home furnishings, accessories, gifts and design services. Ms. Ecker stated the Canyon Economic Development Corporation held a public hearing Thursday, June 9,2011with no opposition. RESOLUTTON NO Item 7. A RESOLUTION OF THE CIry COi'MISSION OF THE CITY OF CANYON APPROVING A PROJECT FUNDING AGREEMENT BETWEEN MEGAN BROWN dba THE RUSTIC GYPSY AND THE CANYON ECONOTIIC DEVELOPMENT CORPORATION REGARDING DIRECT FINANCIAL ASSISTANCE THROUGH THE STUALL BUSINESS ASSISTANCE PROGRAM. THE FUNDING IS BASED ON BUSINESS RETENTION AND EXPANSION. Consider and Take Aooropriate- Action on Request bv Alberta Evans of Xtreme Groomino at 10 US Hiohwav 60 for a Livestock Permit Renewal. Code Enforcement Director Danny Cornelius presented a request to renew a livestock permit from Alberta Evans of Xtreme Grooming. Mr. Cornelius stated in December 2010 Ms. Evans requested al year permitto board 3-8 animals and was granted a 6 month permit as a trial period with a limit of 4 animals. Ms. Evans would like a 1 year extension at this time for 4 animals. Mr. Cornelius stated 5 notices were sent out to property owners within 200 feet with 3 responses received back, 2 opposed, 1 unopposed. Ms. Evans addressed the commission and stated she only had 3 animals at this time and was not planning to expand. Ms. Evans stated she would like to build a privacy fence between her and Economy Storage and didn't want to do this until she knew she would be able to continue boarding up to 4 animals. Ms. Evans stated she has cleaned up the propefi and would continue to keep it up.

110 City Commission Meeting June 20,2011 Page 3 of4 After brief discussion, Commissioner Hinders moved, duly seconded by Mayor Pro-Tem Welch to extend the livestock permit for 1 year with a limit of 4 animals. Motion carried 3-2 with Commissioners Behrens and Logan voting against. Item 8. Consider and Take Appropriate Action on Resolution No A Resolution of the Citv of Canvon Denyino Southwestern Public Service Companv's Proposed Tariff Sheets Related to Certain Amendments to SPS' lnterruptible-service Tariffs. City Manager Randy Criswell presented Resolution No for consideration. Mr. Criswell stated SPS was offering credits to customers who signed up and volunteered to have their power interrupted by SPS as SPS deemed necessary. Mr. Criswell stated the program currently exists and this application simply amends the credits and tariffs. Mr. Criswell stated it was the recommendation of the AXM consultants and SPS to deny this application which will send the application filing directly to the Public Utility Commission who will then set the rates for these programs. Mr. Criswell stated staff concurred with the recommendation. After brief discussion, Commissioner Behrens moved, duly seconded by Commissioner Logan to adopt Resolution No as presented. Motion carried unanimously. RESOLUTTON NO Item 9. A RESOLUTTON By THE CtTy OF CANYON, TEXAS ("ClTy") DENY NG SoUTHWESTERN PUBLIC SERVTCE COIUPANY',S ("SPS") PROPOSED TARTFF SHEETS RELATED TO CERTAIN AIT,IENDMENTS TO SPS' INTERRUPTIBLE. SERVICE TARIFFS SUBMITTED ON OR ABOUT MAY 17, 2011; AUTHORIZING INTERVENTION IN PROCEEDINGS RELATED TO SPS' PROPOSED TARIFFS; REQUIRING THE REIMBURSEMENT OF EXPENSES ASSOCIATED WITH THE REVIEW OF SPS' TARIFFS; DETERMINING THAT THE MEETING AT WHICH THIS RESOLUTION WAS PASSED COilIPLIED WITH THE TEXAS OPEN MEETINGS AGT; MAKING SUCH OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. Executive Session Pursuant to Texas Government Code. S for Discussion on Appointments to Boards and Commissions (Parks. Open Space. and Recreation Advisorv Committee). and for Consultation with Attornev. Mayor Alexander indicated the Commission would retire into Executive Session at 6:06 p.m. Item 10. Consider and Take Appropriate Action on ltems Discussed in Executive Session. Upon returning from Executive Session at 6:28 p.m., no action was taken. Item 11. Consider and Take Appropriate Action on Meetins Dates for July After brief discussion, the Commission agreed to cancel the normal meeting to be held Monday, July 4, 2011 due to the 4th of July Holiday, and to meet Monday July 1 1,2011 and conduct an all day budget work session Monday July 25, 2011 beginning at 9:00 am.

111 City Commission Meeting June 18,2012 Page 3 of 4 Item 8. iate Action on Kate and Dustin Ho-Gland of the Palo Duro Eouestrian Center at 50'14 4'h Ave. City Manager Randy Criswell stated ihe permit had been extended for 30 days at the May 21, 2012 meeting due to a procedural issue and the issue was still being examined. Mr. Criswell suggested the permit be extended at least another 60 days. After brief discussion, Commissioner Logan moved, duly seconded by Commissioner Hinders to extend the Livestock Permit g0 days. Motion carried unanimously. Item L Consider and Take Appropriate Action on a Livestock Permit Renewal Roouest bv Alberta Evans at 510 Hiohwav 60. oirector of Code Enforcement Danny Comelius presented a livestock permit renewal request from Alberta Evans. Mr. Comelius stated Ms. Evans was requesting to board a maximum number of 4 animals, the same as before. Mr. Comelius said the permit was last approved June 20,201'l and in the past year he has not noticed anything that could be construed a6 a nuisance. Commissioner Behrens asked about all the vehicles and the mowing that was needed to which Ms. Evans responded all of that was cunently being addressed and she could put a privacy fence up if it was the wish of the commission. Commissioner Logan expressad he felt this would be good and Ms. Evans agreed to construct the privacy fence. Commissioner Hinders moved, duly seconded by Commissioner Logan to approve the livestock permit for another year. Motion canied unanimously. Item '10. Consider and Take Appropriate Action on Donation of Old Snorkel Fire Truck to Possible Fire Museum. Fire Chief Mike Webb approached the Commission and stated with the award of a grant from FEMA for a new fire truck, the vohicle being replaced must be removed from service to comply with the FEMA grant. Mr. Webb said the options vyere to sell Snorkel 'l or donate it to a museum and he would like to gifr it to one of several fire museums in Tsxas for permanent display. After brief discussion, Commissioner Behrens moved, duly seconded by Commissioner Hinders to grant permission to the Canyon Fire Department to seek a museum in Texas to donate Snorkel 1 to. Motion carried unanimously. Item 11. Hear Report from Citv Enqineer Reoardino Full Development of Rockwell Road Well Field and Associated Costs. City Engineer Owight Brandt presented a report on the current and future status of water supply for the City of Canyon. Mr. Brandt suggested 3 phases for consideration to meet the future water needs of Canyon with phase one being most important in that the Rockwell Road Well Field has to be completed. Mr. Brandt said Phase 2 would consist of extending the supply line from the north elevated storage tank and Phase 3 would be to look for land for additional water sources

112 City Commission Meeting June 17, 2013 Page 2 of 5 Mayor Pro-Tem Welch asked if a timeline had been given to receive the reports from the Strategic Planning Session conducted Monday June 10, Mr. Criswetl said those reports should be received very soon. Mayor Pro-Tem Welch asked if the revisions to the employee handbook had been completed and ready for the Commission to review. Assislant City Manager Chris Sharp stated the final revisions were being mmpleted. Mayor Pro-Tem Welch asked where the Planning and Zoning Commission was wjth the revised landscaping ordinance. Director of Code Enforcement Danny Cornelius said a drafr ordinance was in the works requiring more landscaping inspections making sure conservation is considered and water efficient systems were used. Item 6. Consider and Take Aopropriate Action on Second and Final Readino of Resolution No A Resolution Aoprovino Proiect Fundino Aoreement Between the Rack Bouti Current Business at'1609 4tn Ave. Business and Community Development Director Evelyn Ecker presented Resolution No. O for the final reading and adoption. Ms. Ecker stated The Rack Boutique had been in business in Canyon for '10 years and ready to expand their business. Ms. Ecker said they were expanding their business to include an online store that would operate out of the back of the store. Ms. Ecker said the online store would carry a separate inventory from the front of the store. After brief discussion, Commissioner Hinders moved, duly seconded by Commissioner Logan to adopt Resolution No as presenled. Motion carried 3-O with Mayor Alexinder abstaining. RESOLUTTON NO. 09_2013 APPROVING PROJECT FUNDING AGREEMENT BETWEEN THE CANYON ECONOMIC DEVELOPMENT CORPOMTION AND THE RACK BOUTIOUE FOR DIRECT FINANCIAL ASSISTANCE TO EXPANO THE CURRENT BUSINESS AT TH AVENUE. THE EXPANSION WOULD ENCOUMGE RETAIL SALES, GENEMTE STATE AND LOCAL TAX REVENUE Item 7. Consider and Take Approoriate Action on a Livestock Permit Renewal Reouest bv Alberta Evans at 510 Hiqhwav 60. Code Enforc ment Director Danny Cornelius presented a request for the annual renewal of a livestock permit at 510 Highway 60 by property owner Alberta Evans. Mr. Cornelius referenced the minutes from June 18, 2012 where the Commission stipulated that a general cleanup of the property is completed and a privacy fence is in place before requesting renewal of the permit for Mr. Cornelius said the fence is almost complete and he monitored the property for accumulation violations. Mr. Comelius stated even though not required, 5 letters notifying property owners within 200' of the request to renew the livestock permit were sent out with only one reply received back, from Economy Storage, opposed to the Permit. Mr. Cornelius said as stated in Section of the Code of Ordinances, "any person desiring to keep livestock in the city shall make an application to the City Commlssion. The permit, if granted would expire

113 City Commission Meeting June 17,2013 Page 3 of 5 annually on December 31 and must be renewed in the same manner as original application. The City Commission has the right to revoke any livestock permit if it finds the premises to be a public nuisance". Mayor Alexander asked if it was possible to get on the renewal schedule as stated in the ordinance. Mr. Comelius said a permit could be granted lot 1 y2 yeab if desired by the commission. Mayor Alexander asked Ms. Evans if the fence was complete, to which Ms. Evans said it would be totally complete by September or October this year. Commissioner Logan asked about the junk vehicles. Ms. Evans said one had been removed; one was running when it was parked, which she hopes to have running again this Fall, and the other is a project of her son's. Mr. Cornelius said if they were not tagged and inspected, they were still considered junk vehicles. City Attorney Chuck Hester stated if the junk vehicles were on private property and not visible, they were ok. After discussion, Mayor Pro-Tem Welch moved, duly seconded by Commissioner Hinders to grant the permit for l y2yearcwilh renewal December After discussion, Mayor Pro-Tem Welch amended his motion to include the completion of the fence. Motion carried 3-1 with Commissioner Logan voting against. Item I First Publi rdinance No. 978 Owned bv Gillispie Palmer Development. LLC. City Manager Randy Criswell presented Ordinance No. 978 for its first public Hearing. Mayor Alexander opened the Public Hearing. There being no Comment, Mayor Alexander closed the Public Hearing. ORDINANCE NO, 978 ANNEXING TERRITORY TO THE CITY OF CANYON Gillispie Palmer Development, LLC AN ORDINANCE OF THE CITY OF CANYON, TEXAS, ANNEXING THE TERRITORY HEREIN DESCRIBED TO THE CITY OF CANYON IN MNDALL COUNTY, TEXAS, EXTENDING THE BOUNDARY LIMITS OF THE CITY OF CANYON TO INCLUDE THE PROPERTY HEREIN DESCRIBED WITHIN THE SAID CITY LIMITS, AND GRANTING TO ALL THE INHABITANTS OF SAID PROPERTY ALL THE RIGHTS AND PRIVILEGES OF OTHER CITIZENS AND BINDING SAID INHABITANTS BY ALL OF THE ACTS, ORDINANCES. RESOLUTIONS. AND REGULATIONS OF SAID CITY. Item 9. Consider and Take Aporopriate Action on Recommendation From Audit Committee for Aoproval of 2012 Audit. Mayor Alexander presented the Audit with a brief description of the audit process and the role of the Audit Committee. Mayor Alexander stated the audit had become much more complicated due to various new regulations, and the need

114 City Commission Meeting December 15,2014 Page 2 of 6 Item 7. Conduct Public Hearing and Consider and Take Appropriate Action on Abatement of Substandard Structures at '1615 4h Ave in Accordance with City Ordinance No Section of the Code of Ordinances. Code Enforcement Direc{or Danny Cornelius addressed the Commission and asked for direction for the abatement of property located at th Ave. Mr. Cornelius stated the property owners had begun work to improve the property by repairing the garage door and windows in back, replacing the windows in front and the construction of an awning in the front and painting the outside. Mr. Cornelius said the owners had a plan for compliance. Mayor Alexander opened the public hearing. Mr. Ronald Spriggs, Attorney representing the owner Sarah Kay Brent addressed the Commission. Mr. Spriggs asked for the Commission to grant time to Ms. Brent to comply with what is needed as directed by Code Enforcement to bring the property into compliance. Ms. Brent stated they were working on the property and thought 3 months would be enough time. Commissioner Logan inquired if she intended to occupy the building and she stated that she did not, and that her ultimate desire is to sell the property. There being no other comment, Mayor Alexander closed the public hearing. After discussion, Commissioner Logan moved, duly seconded by Mayor Alexander to table this item and allow Ms. Brent to bring a plan of action to the Commission at the February meeting to be c,onsidered. Motion carried unanimously. Item 8. Consider and Take Appropriate Ac'tion on a Livestock Permit Renewal REuest by Alberta Evans at 510 US Highway 60. Code Enforcement Director Danny Cornelius presented a request from Alberta Evans to renew her livestock permit for another year and to allow her to house 5 animals, up 1 from the 4 currently allowed. Mr. Cornelius said the permit had been renewed once with the stipulation that a privacy fence be built around the property and the junk vehicles taken care of. Mr. Cornelius presented photos of the property showing the fence had been built with the exception of an opening to get tractors and vehicles through. The Commissioners inquired about the junk vehicles still on the property. Ms. Evans said she was going to be using one of them and had plans to build a 'carport / almost garage' to house the vehicles and act as a place to work on them. Mr. Cornelius stated that was something that could be discussed. Afier discussion, Commissioner Hinders moved, duly seconded by Mayor Alexander to renew the Livestock permit for one year and keep the current limit of 4 animals. Motion carried 2-'l with Cornmissioner Logan voting nay. Item 9. Conduct Public Hearing and Consider and Take Appropriate Action on a Request to Rezone Lots 69 through 76. Block I of Canyon East Unit No. 3 to PD (Planned Development District) ftom SF-S (Single-Family Suburban Residential District).

115 City Commission Meeting December 21,2015 The City Commission of the City of Canyon met in regular session at 5:30 p.m. in the City Commission Chambers of the Civic Complex. Mayor Alexander presided over the meeting with the following Commissioners in attendance: Justin Richardson and Joe Shehan. Mayor Pro Tem Gary Hinders and Commissioner David Logan were unable to attend. Also present were the following City Staff: City Manager Randy Criswell, Assistant City Manager Chris Sharp, City Secretary Gretchen Mercer, Golf Course Manager John Haun, Director of Golf Casey Renner, Director of Code Enforcement Danny Cornelius, Assistant City Manager for Special Projects Jon Behrens, Director of Public Works Dan Reese, and City Attorney Chuck Hester. Item 1. Call to Order. Mayor Alexander called the meeting to order at 5:36 p.m. Item 2. lnvocation. Mayor Alexander gave the invocation. Item 3. Pledge of Allegiance. Mayor Alexander led the Pledge of Allegiance. Item 4. Approval of Minutes of the Meeting of December 7. 20'15. Commissioner Shehan moved, duly seconded by Commissioner Richardson, to approve the minutes of December 7,2015 as presented. Motion carried unanimously. Item 5. Public Forum - Comments from lnterested Citizens. No comments were made. Item 6. Consider and Take Appropriate Aclion on a Livestock Permit Renewal Request by Alberta Evans at 510 US Highway 60. Code Enforcement Director Danny Cornelius presented a renewal application for a Livestock Permit from Albert Evans at 510 US Highway 60. Mr. Cornelius stated the permit was last renewed December 15,2014 allowing a maximum number of livestock to 4 animals. The permit expired annually December 31 as stated in Section of the Code of Ordinances. Mr. Cornelius said the City Commission has the right to revoke any livestock permit if it finds the premises to be a public nuisance. Mr. Cornelius said an outbuilding had been deemed an "unsafe structure" and is up for removal. Ms. Evans stated she could not afford to replace or repair the structure to code so destruction was the best option. Mayor Alexander asked about the fence, referring to past permit issuance with the condition of the fence being constructed all around to screen the property and a proposed carport to house junk vehicles. Mayor Alexander asked City Attorney Chuck Hester if the back of the property had to be screened. Mr. Hester stated if it is visible from a public right-of-way it is required to be screened. Ms. Evans stated she

116 City Commission Meeting December 21, 2015 Page 2 of 7 did not have the means to construct a carporugarage and a fence would be more realistic for her. Mr. Cornelius said there had been no complaints on the animal$, lust weed violations and the unsafe structure cunently being addressed. Mr. Cornelius said 5 notices were sent to property owners within 200 ft. with no responses received. After discussion, commissioner Richardson moved, duly seconded by commission shehan to renew the livestock permit. Motion carried unanimously. Item 7. Conduct a Public Hearing and Consider and Take Appropriate Action on Ordinance No to Rezone the Proposed Canyon East Unit No.5 to SF-S (Single-Family Suburban Residential District) from SF-A (Single-Familv Agricultural Residential Diskict). Code Enforcement Director Danny Cornelius presented Ordinance No for consideration. Mr. Cornelius stated all undeveloped land is annexed in as agriculture temporarily until the 3ppropriate zoning is requested. Mr. Cornelius said Kuhlman and Sons LP and Canyon East Development LLC recently submitted a plat for Canyon East Unit No. 5 and the application for zoning. The proposed use is single-family dwellings. Mr. Cornelius said 16 letters were sent out to property owners within 200 feet with 3 responses, all in favor of the request. Mayor Alexander opened the public hearing. There being no comment, Mayor Alexander closed the public hearing. After discussion, Commissioner Richardson moved, duly seconded by Mayor Alexander to adopt Ordinance No as presented. Motion carried unanimously. ORDINANCE NO Rezoning Canyon East Unit No. 5 AN ORDINANCE OF THE CITY COMMISSION OF THE CIry OF CANYON, TEXAS, REZONING CANYON EAST UNIT NO. 5, AN ADDITION TO THE CITY OF CANYON, RANDALL COUNry, TEXAS, PROVIDING THAT THE ZONING CLASSIFICATION BE POSTED UPON THE ZONING DISTRICT MAPS OF THE CITY OF CANYON, PROVIDING THAT ALL ORDINANCES OR PARTS OF ORDINANCES IN CONFLICT HEREWTH ARE EXPRESSLY REPEALED, AND PROVIDING FOR AN EFFECTIVE DATE. Item 8. Consider and Take Approoriate Action on a Plat for Canyon East Unit No. 5. code Enforcement Director Danny cornelius presented a plat for canyon East Unit No. 5. Mr. Cornelius said this was the final step after rezoning of Canyon East Unit No. 5 with 29 proposed lots. Mr. Cornelius said there were several lots that did not meet the setback requirements as defined in the Zoning Ordinance, but there are provisions for adoption and acceptance of setbacks requested by the developer if they vary from the ordinance. canyon planning and Zoning Commission had considered them and recommended approval of the Plat as presenied.

117 AGENDA To: From: Randy Criswell, City Manager Danny Cornelius, Director of Code Enforcement Date: January 17, 2018 Re: History of Livestock Permit Request and Renewals for 510 US Highway 60. Just to bring the new Commission members up to date, below is a brief history of the livestock permit requests for 510 Hwy 60. City Commission Minutes are attached. The initial livestock permit request was presented in December of 2010 after our office became aware that horses and donkeys were being kept on the property at 510 Hwy 60. A 6 month permit was approved allowing 4 animals. The vote was 4-1. The 2 nd request was presented in June of Ms. Evans stated that she would build a privacy fence between her property and Economy Storage to the west. A 1 year permit was approved allowing 4 animals. The vote was 3-2. The 3 rd request was presented in June of Commissioner Behrens expressed concern about vehicles and weeds on the property. Ms. Evans agreed to construct a privacy fence. A 1 year permit was approved allowing 4 animals. The vote was unanimous. The 4 th request was presented in June of Mayor Alexander asked if the privacy fence was complete. Ms. Evans said it would be complete by September or October of Commissioner Logan expressed concerns about the junk vehicles. A 1 ½ year permit was approved allowing 4 animals with the requirement that the privacy fence be completed. The vote was 3-1. The 4 th request was presented in December of According to the minutes, the privacy fence had been completed around the property with the exception of an opening to get tractors and vehicles through. A fence had only been built across the front of the property. The Commission expressed concerns about the junk vehicles on the property. Ms. Evans said she planned to build a carport/almost garage to house and work on them. A 1 year permit was approved allowing 4 animals. The vote was 2-1. The 5 th permit request was presented in December of An accessory building was being condemned as an unsafe structure. That building has been removed. Mayor Alexander asked about constructing a privacy fence across the back also. Ms. Evans said she could not afford to build the carport/garage and the fence would be more realistic to her. A 1 year permit was approved allowing 4 animals. The vote was unanimous. A privacy fence has only been constructed across the front of the property. City of Canyon

118 REGARDING ITEM 14 AGENDA To: From: Randy Criswell, City Manager Danny Cornelius, Director of Code Enforcement Date: January 16, 2018 Re: Consider and Take Appropriate Action on a Plat for Hix Road Unit No. 1. The attached plat for Hix Road Unit No. 1 has been submitted. Although the property is not within our city limits, the city does have the authority to approve plats within our Extraterritorial Jurisdiction (ETJ). The ETJ for the City of Canyon is 1 mile. This addition is south of 4 th Avenue on Hix Road. According to the owner, the proposed use for Lot 1 is an RV park with 10 spaces. The owner plans to build himself a house on Lot 2. We have not received the drainage study for the project. If the plat is approved, it will be pending receipt and approval of the drainage study. The Planning and Zoning Commission voted unanimously to recommend approval of the plat. City of Canyon

119